Discussion of

"A Clinical Exploration of Value Creation and Destruction in Acquisitions:
Organization Design, Incentives, and Internal Capital Markets"

From the NBER Conference on Mergers & Productivity

G. William Schwert

University of Rochester, Rochester, NY 14627
and National Bureau of Economic Research

Kaplan, Mitchell, and Wruck (1999) present interesting detailed evidence on two acquisitions and why the authors conclude that they failed. They argue that incentives and organizational form are important determinants of success or failure. They also raise fundamental questions about the methods of clinical research and the lessons that can be learned from it. As with all of the papers in this conference volume, the challenge to enrich the set of hypotheses that can be addressed using large sample empirical methods is an important yet difficult goal.

Key words: takeover, corporate control, divestiture, clinical study

JEL Classifications: G34

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Last Updated on 6/11/2021