Two hypotheses are considered to explain employee layoffs by corporations: (1) the declining investment opportunities hypothesis; and (2) the efficiency hypothesis. The stock market response to employee layoff announcements is estimated to be negative, which is consistent with the declining...

Announcements of voluntary liquidation or reorganization by real estate corporations are analyzed. There is a positive stock price response to announcement of liquidation, and a negative stock price response to announcements of reorganization. Results were the same before and after the 1978...