search query: @author Brusco, S. / total: 8
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| Author: | Brusco, S. |
| Title: | Bankruptcy, takeovers, and wage contracts |
| Journal: | Journal of Economics and Management Strategy
1996 : WINTER, VOL. 5:4, p. 515-534 |
| Index terms: | ECONOMICS MANAGEMENT STRATEGY |
| Language: | eng |
| Abstract: | Takeovers give raiders the opportunity of breaking implicit contracts inside the firm. If implicit contracts are adopted by workers and management to reach more effective outcomes, then the possibility of takeovers may may cause a welfare loss. The authors show that, under some conditions, this argument can go through even if the firm and the workers can write explicit and complete contracts. The crucial assumption is that the profitability of the firm is linked to its financial situation, in the sense that a firm which has a high probability of bankruptcy will face fewer opportunities than a financially solid firm. |
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