In the U.S. food manufacturing industry, plants that were purchased (i.e., acquired) became more productive after an ownership change. The study — which covered all 28,407 manufacturing plants in the industry, 1977-87 — also found that, with the exception of large plants, plants with above average productivity were the ones most likely to be acquired.

These findings suggest a more benign view of mergers and acquisitions than is often advanced in discussions among academics, policymakers, the media, and the public.

Data from the U.S. Census Bureau’s Longitudinal Research Database (LRD), housed at the Center for Economic Studies, provided the basis for this study.