An Empirical Analysis of the Patterns in Defense Industry Consolidation and their Subsequent Impact

Report Number: NPS-AM-07-006

Series: Acquisition Management

Category: Defense Mergers

Report Series: Proceedings Paper

Authors: Nayantara Hensel

Title: An Empirical Analysis of the Patterns in Defense Industry Consolidation and their Subsequent Impact

Published: 2007-04-01

Sponsored By: Acquisition Research Program

Status: Published--Unlimited Distribution

Research Type: NPS Faculty

Full Text URL: http://acquisitionresearch.org/files/FY2007/NPS-AM-07-006.pdf

Keywords: Defense Mergers

Abstract:

The defense industry has witnessed significant consolidation since the end of the Cold War. This paper explores the causes of the wave of defense mergers, as well as their impact. The analysis finds that the frequency of defense mergers is more strongly correlated with overall merger activity in the economy than with DoD outlays. In examining SAR cost data on weapons systems, only 50-65% of the weapons systems