Please note that Internet Explorer version 8. Please refer to this blog post for more information. We investigate if and how mergers and acquisitions are affected by trends in the capital market, and particularly by a stock market bubble. Moreover, the bursting of the bubble seems to have led to further cautiousness by investors, which extended throughout the years subsequent to the bursting of the bubble, even when prices on the exchange had rebounded.

While we do not find robust evidence for changes in price multiples outside the exchange in concomitance with the changes on the exchange, we document changes in the information used by investors to value their targets.

It seems that investors experienced a learning process in terms of the type of variables preferred, appearing to be more cautious since the bubble burst. This learning process investors undergo in concomitance to processes in the market seems to result in their being less affected by periodical or cyclical sentiments of euphoria and depression in the capital market.

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Stock Market Crash of Facts, Causes, Effects

The Quarterly Review of Economics and Finance Volume 50, Issue 4 , November , Pages Stock market bubble effects on mergers and acquisitions. Author links open the author workspace.

Numbers and letters correspond to the affiliation list.

Click to expose these in author workspace b. Click to expose these in author workspace Ilanit Gavious. Opens the author workspace Opens the author workspace a.

Click to expose these in author workspace Rami Yosef.

Click to expose these in author workspace a Guilford Glazer Faculty of Business and Management, Ben-Gurion University, Israel b Ono Academic College, Israel. Abstract We investigate if and how mergers and acquisitions are affected by trends in the capital market, and particularly by a stock market bubble.

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Effects of the Stock Market Crash | Finance - Zacks

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