Integrating Relative Standing and Market discipline: A complexity theory perspective of post-merger and acquisition executive departure

Akie Iriyama, Jason W. Park, Franky Supriyadi, Haibin Yang

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

Mergers and acquisitions (M&As) typically accelerate target top management team (TMT) executive departures. Market discipline and Relative Standing are two major and competing economic and sociological explanations for this phenomenon which lack a satisfactory theoretical integration. To fill this gap in the literature, we model the M&A market as a complex adaptive system composed of TMTs which rid themselves of executives via self-organized critical processes, generating M&A market-level properties that are emergent, or not easily explained with reference to the individual TMTs. The observation of an emergent power law distribution in target TMT executive retention rates for M&A activities in the United States supports our interpretation.

Original languageEnglish
Title of host publicationAdvances in Mergers and Acquisitions
EditorsSydney Finkelstein, Cary Cooper
Pages181-197
Number of pages17
DOIs
Publication statusPublished - 2012

Publication series

NameAdvances in Mergers and Acquisitions
Volume11
ISSN (Print)1479-361X

Keywords

  • Complex adaptive systems
  • Mergers and acquisitions
  • Power law distribution
  • Self-organized criticality
  • Top management teams

ASJC Scopus subject areas

  • Business and International Management

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    Iriyama, A., Park, J. W., Supriyadi, F., & Yang, H. (2012). Integrating Relative Standing and Market discipline: A complexity theory perspective of post-merger and acquisition executive departure. In S. Finkelstein, & C. Cooper (Eds.), Advances in Mergers and Acquisitions (pp. 181-197). (Advances in Mergers and Acquisitions; Vol. 11). https://doi.org/10.1108/S1479-361X(2012)0000011012