Abstract
The aggregate level of U.S. merger activity may be influenced by expectations concerning future economic growth (as proxied by stock prices), current economic conditions, and/or interest rates. This paper applies regression analysis to the W. T. Grimm annual merger data from 1963–1986 to determine which of these determinants are significant. It also examines whether the government's antitrust stance influences merger activity. The results indicate that current economic conditions are a significant determinant, while interest rates and the government's antitrust stance appear to have no effect on mergers. The result concerning stock prices was inconclusive and will require more analysis.
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