Social and Behavioral Sciences Commons^™

Investigating Insensitivity To Prior Probabilities In Merger And Acquisition Decision Making, James A. Mcgaughan

Legacy Theses & Dissertations (2009 - 2024)

In this dissertation I look at the high failure rates of Mergers and Acquisitions (M&As) and why there has been no discernible change in outcomes over the last several decades. Although we have greater access to data, sophisticated business intelligence (BI) and data analytics (DA) tools, and work by industry professionals and academics to improve the process, high failure rates have persisted. I explore the possibility that the representativeness heuristic could play a role, and specifically, the possibility that prior probabilities are being ignored in M&A evaluations. I use a mixed methods approach to explore the hypothesis that decision makers …