In this article we consider the impact of private equity and buyouts on employment, remuneration, and other human resource management practices by reviewing and synthesizing existing studies. We show that the impact tends to differ between buyouts and buy-ins, and argue that private equity is a heterogeneous phenomenon. Several issues that would benefit from further research are identified including the relative impact on employment, terms and conditions and job quality for managerial and non-managerial employees.
Amess, K. and Wright, M. (2007a) ‘The Wage and Employment Effects of Leveraged Buyouts in the U.K.’, International Journal of Economics and Business14(2):179-95.
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Amess, K. and Wright, M. (2007b) Barbarians at the Gate: Do LBOs and Private Equity Destroy Jobs? Occasional Paper, Centre for Management Buy-Out Research .
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Amess, K., Brown, S. and Thompson, S. (2007) ‘Management Buyouts, Supervision and Employee Discretion’ , Scottish Journal of Political Economy54(4):447-74.
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Amess, K., Girma, S. and Wright, M. (2008) What are the Wage and Employment Consequences of Leveraged Buy-Outs, Private Equity and Acquisitions in the UK? Occasional Paper, Centre for Management Buy-Out Research .
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Bacon, N., Wright, M. and Demina, N. (2004) ‘Management Buyouts and Human Resource Management’ , British Journal of Industrial Relations42(2):325-47.
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Bacon, N., Wright, M., Demina, N., Bruining, H. and Boselie, P. (2008) ‘HRM, Buy-outs and Private Equity in the UK and the Netherlands’, Human Relations61(10):1399-433.
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Bradley, K. and Nejad, A. (1989) Managing Owners: The NFC Buy-out. Cambridge: Cambridge University Press.
Bruining, H., Boselie, P., Wright, M. and Bacon, N. (2005) ‘The Impact of Business Ownership Change on Employee Relations: Buyouts in the UK and the Netherlands’, International Journal of Human Resource Management16:345-65.
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Centre for Management Buy-Out Research (CMBOR) (2006) Buyouts in the UK. Quarterly Review from the Centre for Management Buyout Research. CMBOR: University of Nottingham.Autumn.
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Centre for Management Buy-Out Research (CMBOR) (2007) ‘Trends in UK Management Buyouts’, Management Buyouts: Quarterly Review from the Centre for Management Buyout Research, University of Nottingham.
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Cressy, R., Munari, F. and Malipiero, A. (2007) Creative Destruction: Evidence that Buyouts Cut Jobs to Raise Returns, Working Paper No.5, Entrepreneurship and Innovation Centre , University of Birmingham.
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Cumming, D., Siegel, D.S. and Wright, M. (2007) ‘Private Equity, Leveraged Buyouts and Governance’ , Journal of Corporate Finance13:439-60.
14.
Davis, S., Lerner, J., Haltiwanger, J., Miranda, J. and Jarmin, R. (2008) ‘Private Equity and Employment’, in J. Lerner and A. Gurung (eds) The Global Impact of Private Equity Report 2008, Globalization of Alternative Investments, Working Papers Volume 1, pp. 43-64. Davos: World Economic Forum.
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Financial Services Authority (2006) Private Equity: A Discussion of Risk and Regulatory Engagement, Discussion Paper DP06/6. London: Financial Services Authority.
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Gilligan, J. and Wright, M. (2008) Private Equity Demystified: An Explanatory Guide. London: Institute of Chartered Accountants in England and Wales (ICAEW).
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Hall, D. (2007) Methodological Issues in Estimating the Effect of Private Equity on Employment, PSIRU, University of Greenwich.
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Hansmann, H. (1990) ‘When Does Worker Ownership Work?: ESOPs, Law Firms, Codetermination, and Economic Democracy’, Yale Law Journal99(8):1749-816.
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Harris, R., Siegel, D.S. and Wright, M. (2005) ‘Assessing the Impact of Management Buyouts on Economic Efficiency: Plant-level Evidence from the United Kingdom’, The Review of Economics and Statistics87:148-53.
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Healy, J., Carty, S., Woodyard, C. and Krantz, M. (2007) ‘Unprecedented Auto Deal: Daimler Essentially Pays to Part Ways withChrysler’, USA TodayM oney (15May): 1B-2B.
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International Trade Union Confederation (ITUC) (2007) Where the House always Wins: Private Equity, Hedge Funds and the New Casino Capitalism. Brussels: ITUC.
22.
Kaplan, S.N. (1989) ‘The Effects of Management Buyouts on Operations and Value’, Journal of Financial Economics24:217-54.
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Lichtenberg, F.R. and Siegel, D.S. (1990) ‘The Effect of Leveraged Buyouts on Productivity and Related Aspects of Firm Behavior’, Journal of Financial Economics27:165-94.
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Muscarella, C. and Vetsuypens, M. (1990) ‘Efficiency and Organizational Structure: A Study of Reverse LBOs’, Journal of Finance65:1389-413.
Pendleton, A., Wilson, N. and Wright, M. (1998) ‘Employees Attitudes in Buy-outs of Privatised Bus Companies’, British Journal of Industrial Relations36(1):99-123.
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PSE Group in European Parliament (2007) Hedge Funds and Private Equity: A Critical Analysis. Report of the PSE-Group in European Parliament.
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Robbie, K. and Wright, M. (1995) ‘Managerial and Ownership Succession and Corporate Restructuring: The Case of Management Buy-ins’, Journal of Management Studies32: 527-50.
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Robbie, K., Wright, M. and Ennew, C. (1993) ‘Management Buyouts from Receivership’, Omega21(5):519-30.
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Robbie, K., Wright, M. and Thompson, S. (1992) ‘Management Buy-ins in the UK’, Omega20(4):445-56.
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Smith, A. (1990) ‘Capital Ownership Structure and Performance: The Case of Management Buyouts’, Journal of Financial Economics13:143-65.
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Wieser, O., Wright, M. and Robbie, K. (1997) ‘Management and Employee Buyouts from the Austrian Public Sector’, Annals of Public and Cooperative Economics68(4):689-712.
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Work Foundation (2007) Inside the Dark Box: Shedding Light on Private Equity. London : Work Foundation. Wright, M. and Coyne, J. (1985) Management Buyouts. Beckenham: CroomHelm.
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Wright, M., Buck, T. and Filatotchev, I. (2002) ‘Post-Privatization Effects of Management and Employee Buyouts’, Annals of Public and Cooperative Economics73(3):303-52.
35.
Wright, M., Burrows, A., Ball, R., Scholes, L., Meuleman, M. and Amess, K. (2007) The Implications of Alternative Investment Vehicles for Corporate Governance: A Survey of Empirical Research. Report prepared for the Steering Group on Corporate Governance. Paris: OECD.
36.
Wright, M., Chiplin, B., Thompson, S. and Robbie, K. (1990) ‘Management Buyouts, Trade Unions and Employee Ownership’ , Industrial Relations Journal21(2):137-46.
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Wright, M., Coyne, J. and Lockley, H. (1984) ‘Management Buyouts and Trade Unions: Dispelling the Myths’, Industrial Relations Journal15:45-52.
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Wright, M., Thompson, S. and Robbie, K. (1992) ‘Venture Capital and Management-led Leveraged Buy-outs: A European Perspective’, Journal of Business Venturing7:47-71.
39.
Wright, M., Wilson, N., Robbie, K. and Ennew, C. (1996) ‘An Analysis of Failure in UK Buy-outs and Buy-ins’ , Managerial and Decision Economics17:57-70.
