The Journal of Business and Economic Studies,Vol. 17, Issue 2, Pages: 77.
This paper investigated the relationship between mergers & acquisitions (M & A) and efficiency change in the US property-liability insurance industry for the years 1990-2004. The cost, revenue, pure technical, scale, and allocative efficiency were estimated using data envelopment analysis (DEA). The empirical results revealed that acquirers’ overall cost and revenue efficiency declined following M & As. This finding implied that M & A has the potential to create inefficiencies, perhaps due to scale diseconomies and post- …