Hiring new key inventors to improve firms' post-M&A inventive output


Arroyabe, Marta F. ; Hussinger, Katrin ; Hagedoorn, John


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URL: https://madoc.bib.uni-mannheim.de/56911
URN: urn:nbn:de:bsz:180-madoc-569113
Document Type: Working paper
Year of publication: 2020
The title of a journal, publication series: ZEW Discussion Papers
Volume: 20-029
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: O34 , O32 , G34,
Keywords (English): M&A , post-M&A inventive output , key inventors , KBV
Abstract: Although merger and acquisitions (M&As) are acknowledged as an important means to access innovative assets and know-how, firms’ inventive output often declines in the post-M&A period. Financial, managerial and organizational constraints related to the M&A event contribute to inventive output declines and inventors’ departure. Prior literature treats the acquiring firm as a passive observer of invention declines. This study argues that acquiring firms can take measures by hiring new key inventors. We show that the hiring of new key inventors in the post-M&A period can counteract invention declines in two ways. First, these newly hired inventors are associated with an increase of corporate inventive output after the M&A. Second, they are also associated with an improved inventive output of inventors already working for the acquiring firm. These results suggest that an appropriate hiring policy can counteract declining inventive output of firms in the aftermath of M&As.

Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.




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