Literature Review Women on boards and in TMTS and firm performance144 I observe a positive effect on abnormal returns in line with my expectations The effects are statisti cally significant at the 10 percent level Model III on the announcement day and at the 5 percent le vel Model II and III in the three days event window From the shareholders perspective the assumed positive effects of releasing employees from the investment banking division dominate the potential negative effects Expected positive effects are most likely the substantial cost savings due to the high salary levels in investment ban king An expected reduction of risks associated with the release of employees involved in invest ment banking might also play a role here I also observe a positive effect of proactive layoff strategies on CAAR suggesting that capital markets expect higher future cash flows to result from the planned cuts in personnel expenses In contrast to the results of the univariate analysis results are statistically significant In the three days event window 1 1 I find statistical significance on the 10 percent level Model II V and VI In the eleven days window 5 5 coefficients for all re levant models are stronger positive and statistically significant at the 5 percent level The multivaria te analysis results therefore provide support for hypothesis 1 Hypothesis 2 states that market reactions to layoff announcements will differ depending on the stated reason At first glance results meet my expecta tions with regard to the coefficients sign In case the announcing bank provides cost cutting hypo thesis 2a as main rationale for the dismissals ca pital markets assess the measure as value enhan cing In case given reasons are a fall in demand or poor past performance hypothesis 2c sharehol ders perceive the layoffs as a value decreasing measure M A hypothesis 2b and reorganization hypothesis 2a as given reasons lead to varying 26 Figures for 2014 were not available at the time of creation of this paper results coefficients have positive and negative signs in different event windows Similarly the analysis of the stated reason branch closure bran ches hypothesis 2a yields an inconsistent picture While coefficients are negative in all models on the announcement day and the three days event window their sign changes to positive for all mo dels in the eleven days window Yet all findings are statistically insignificant Consequently I reject hypotheses 2 2a 2b and 2c I further examine the influence of employment protection legislation through multivariate analysis I use an alternative model to the univariate ana lysis of US versus all non US countries Strict labor law is a country s strictness of employment pro tection legislation according to OECD data 2016a I consider the values in 2004 and 201326 The mi nimum value in both years is 0 25 for the United States maximum values are 4 4 in 2004 and 3 2 in 2013 in each case for Portugal I determine mean values Countries with a value of below 2 the sample s mean are coded non strict including the United States the United Kingdom Ireland Switzerland and Belgium The remaining countries with a value of 2 or above are coded strict The following table 5 7 presents the determinants of the abnormal stock return on the announcement day 0 0 The coefficients are small and statistically insigni ficant across all event windows and do therefore neither provide support for hypothesis 4 nor for 4a and 4b The negative sign may be an indica tor that in case the announcing bank is subject to strict employment protection legislation abnormal returns will be lower or stronger negative As the univariate analysis has already shown for US versus non US banks capital markets are aware of legal barriers and anticipate associated costs This results in a downwards revaluation of future cash flows Layoffs and shareholder wealth

Vorschau DIRK-Forschungsreihe Band 21 Workforce diversity and personal policies Seite 144
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