Reprint of: Horizontal mergers and product innovation
| Autor: | Giulio Federico, Tommaso Valletti, Gregor Langus |
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| Rok vydání: | 2018 |
| Předmět: |
Economics and Econometrics
SCHUMPETER Economics Strategy and Management Economics Econometrics and Finance (miscellaneous) Social Sciences 1401 Economic Theory COMPETITION Competition (economics) Microeconomics Oligopoly Business economics Mergers Business & Economics 0502 economics and business 050207 economics Innovation 050205 econometrics Stylized fact R&D Product innovation 05 social sciences Economic surplus Incentive Industrial relations Externality |
| Zdroj: | International Journal of Industrial Organization. 61:590-612 |
| ISSN: | 0167-7187 |
| DOI: | 10.1016/j.ijindorg.2018.11.005 |
| Popis: | We set up a stylized oligopoly model of uncertain product innovation to analyze the effects of a merger on innovation incentives and on consumer surplus. The model incorporates two competitive channels for merger effects: the “price coordination” channel and the internalization of the “innovation externality”. We solve the model numerically and find that price coordination between the two products of the merged firm tends to stimulate innovation, while internalization of the innovation externality depresses it. The latter effect is stronger in our simulations and, as a result, the merger leads to lower innovation incentives for the merged entity, absent cost efficiencies and knowledge spillovers. In our numerical analysis both overall innovation and consumer welfare fall after a merger. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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