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Bourreau, Marc
, Jullien, Bruno and Lefouili, Yassine
(2018)
Mergers and demand-enhancing innovation.
TSE Working Paper, n. 18-907, Toulouse
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Abstract
We study the impact of horizontal mergers on merging firms’ incentives to invest in demand-enhancing innovation. In our baseline model, we identify four effects of a symmetric merger on these incentives: the innovation diversion effect, the margin expansion effect, the demand expansion effect, and the per unit return to innovation effect. We offer succient conditions for a merger to reduce or raise merging firms’ incentives to innovate in the absence of spillovers and effciency gains in R&D, and find that a comparison between the innovation diversion and price diversion ratios is informative about the impact of a merger on innovation.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | March 2018 |
| Place of Publication: | Toulouse |
| Uncontrolled Keywords: | Horizontal Mergers, Innovation, Competition |
| JEL Classification: | D43 - Oligopoly and Other Forms of Market Imperfection L13 - Oligopoly and Other Imperfect Markets L40 - General |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Institution: | Université Toulouse 1 Capitole |
| Site: | UT1 |
| Date Deposited: | 24 Apr 2018 11:30 |
| Last Modified: | 16 Apr 2024 09:41 |
| OAI Identifier: | oai:tse-fr.eu:32578 |
| URI: | https://publications.ut-capitole.fr/id/eprint/25893 |
