We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Do Takeover Defense Indices Measure Takeover Deterrence?
- Authors
Karpoff, Jonathan M.; Schonlau, Robert J.; Wehrly, Eric W.
- Abstract
Many researchers use the G-index or E-index to measure firms' takeover defenses. Others argue that these indices are not related to firms' takeover likelihoods. We find that, unlike their raw values, the instrumented versions of these indices are significantly and negatively related to acquisition likelihood. The difference between the raw and instrumented results indicates that the G-index and E-index include an endogenous component and highlights the importance of accounting for endogeneity in tests that use takeover indices to measure takeover deterrence. We provide data on new instruments that researchers can use to address these issues.
- Subjects
ANTITAKEOVER strategies; CORPORATIONS; ENDOGENEITY (Econometrics); TARGET companies; METHODOLOGY
- Publication
Review of Financial Studies, 2017, Vol 30, Issue 7, p2359
- ISSN
0893-9454
- Publication type
Article
- DOI
10.1093/rfs/hhx025