The Human Factor in Acquisitions

  • Geoffrey Tatea Liu Yangb
  • Published 2015


Why do firms diversify into unrelated product markets? Internal labor markets allow firms to reallocate workers in response to industry shocks. They also strengthen workers’ incentives to invest in transferable, productivity-enhancing skills. Thus, the transferability of human capital can be a source of merger synergies. To test this hypothesis, we… (More)

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