TY - JOUR
T1 - The effects of leveraged buyouts on productivity and related aspects of firm behavior
AU - Lichtenberg, Frank R.
AU - Siegel, Donald
N1 - Funding Information:
*This research was performed at the Census Bureau’s Center for Economic Studies with financial support from the Securities Industry Association. Data on leveraged buyouts were provided by Morgan Stanley and Co. We wish to thank these organizations for their cooperation and support. We are also grateful to Michael Jensen (the editor), Kevin Murphy (a referee), an anonymous referee, and Krishna Palepu for helpful comments on previous drafts, and to participants in the conference on ‘The Structure and Governance of Enterprise’. The views expressed herein are our own, and we are responsible for any errors.
PY - 1990/9
Y1 - 1990/9
N2 - We investigate the effects of leveraged buyouts on total factor productivity (TFP) and related variables using a longitudinal database including over 12,000 manufacturing plants. LBOs (particularly MBOs) that occured during 1983-1986 had a strong positive effect on TFP in the first three post-buyout years: plant productivity increased from 2.0% above industry mean in the three pre-buyout years to 8.3% above industry mean in the three post-buyout years. However, 1981 and 1982 buyouts had no significant productivity effect. The employment and compensation of white-collar workers decline following buyouts, but those of blue-collar workers are unchanged.
AB - We investigate the effects of leveraged buyouts on total factor productivity (TFP) and related variables using a longitudinal database including over 12,000 manufacturing plants. LBOs (particularly MBOs) that occured during 1983-1986 had a strong positive effect on TFP in the first three post-buyout years: plant productivity increased from 2.0% above industry mean in the three pre-buyout years to 8.3% above industry mean in the three post-buyout years. However, 1981 and 1982 buyouts had no significant productivity effect. The employment and compensation of white-collar workers decline following buyouts, but those of blue-collar workers are unchanged.
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U2 - 10.1016/0304-405X(90)90025-U
DO - 10.1016/0304-405X(90)90025-U
M3 - Article
AN - SCOPUS:0001121113
SN - 0304-405X
VL - 27
SP - 165
EP - 194
JO - Journal of Financial Economics
JF - Journal of Financial Economics
IS - 1
ER -