The Hubris Hypothesis of Corporate Takeovers
The Hubris Hypothesis of Corporate Takeovers Author(s): Richard Roll Source: The Journal of Business, Vol. 59, No. 2, Part 1 (Apr., 1986), pp. 197-216 Published by: The University of Chicago Press Stable URL: http://www.jstor.org/stable/2353017 Accessed: 10/02/2010 10:10
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Richard Roll
University of California, Los Angeles
The Hubris Hypothesis of Corporate Takeovers*
Finally, knowledge of the source of takeover gains still eludes us. [Jensen and Ruback 1983, p. 47]
I. Introduction
Despite many excellent research papers, we still do not fully understandthe motives behindmergers and tender offers or whether they bring an increase in aggregatemarketvalue. In their comprehensive review article (from which the
Your use of the JSTOR archive indicates your acceptance of JSTOR 's Terms and Conditions of Use, available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR 's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/action/showPublisher?publisherCode=ucpress. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.
The University of Chicago Press is collaborating with JSTOR to digitize, preserve and extend access to The Journal of Business.
http://www.jstor.org
Richard Roll
University of California, Los Angeles
The Hubris Hypothesis of Corporate Takeovers*
Finally, knowledge of the source of takeover gains still eludes us. [Jensen and Ruback 1983, p. 47]
I. Introduction
Despite many excellent research papers, we still do not fully understandthe motives behindmergers and tender offers or whether they bring an increase in aggregatemarketvalue. In their comprehensive review article (from which the
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