. Third, capabilities are traded in a merger market. We address two questions: (1) what are the characteristics of firms that …

We study optimal merger policy in a dynamic model in which the presence of scale economies implies that firms can … the period the merger is proposed. We also find that the ability to commit can lead to a significant welfare improvement …

relatively low in value added per employee at the time of takeover and before, a characteristic we take to indicate relatively …-term recoveries after takeover from the misfortunes of the takeover year and a return to higher growth rates of employment and output … year or two after takeover but seem to have increased their profitability or efficiency relative to their industries. The …

that the tax losses and credits of acquired firms likewise exerted no impact on merger activity. Though the use of such …