Merger policy in innovative industries

Miguel González-Maestre and Lluís M. Granero ()
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Lluís M. Granero: Universitat de València

Portuguese Economic Journal, 2016, vol. 15, issue 3, No 2, 147 pages

Abstract: Abstract We analyze optimal merger policy in R&D-intensive industries with product innovation aiming to improve the quality of products. Our results suggest that a permissive merger policy is rarely optimal in high-tech industries when the antitrust authority considers a welfare standard that balances the impact of mergers on consumers’ surplus and firms’ profits. In particular, relative to a benchmark where the effects from R&D are absent, we show that the optimal merger policy should not be substantially more permissive in the presence of those effects from R&D.

Keywords: Merger policy; High-tech industries; Endogenous quality; Oligopoly (search for similar items in EconPapers)
JEL-codes: L11 L12 (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1007/s10258-016-0122-9

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