The role of Innovation in Merger Policy: Europe's efficiency defense versus America's Innovatoin Markets approach

E. Cefis, M. Grondsma, A. Sabidussi, E.J.J. Schenk

Research output: Book/ReportReportAcademic

Abstract

Changes in the world’s economies and discussions in the literature about the growing importance of innovation to firms have given rise to a demand for expanding the analysis of merger policy. The present study focuses on the different criteria used to assess the impact of M&A activities on innovation. The analysis is both theoretical and empirical. From a theoretical perspective, two main approaches are discussed: the efficiency defense approach, adopted in Europe, and the innovation markets doctrine as developed in the United States. The present paper contributes to the literature by suggesting that an integration of the two approaches would significantly improve M&A assessment. On the empirical side, two cases that have been scrutinized by both the European Commission and the U.S. Federal Trade Commission are discussed. The results show the relevance of the different approaches used when dealing with innovation in the assessment of mergers.
Original languageEnglish
Place of PublicationUtrecht
PublisherTsjalling C. Koopmans Research Institute, Utrecht University
Number of pages38
Publication statusPublished - 2007

Publication series

NameDiscussion paper series
PublisherTsjalling C. Koopmans Research Institute, Utrecht University
No.07-21

Keywords

  • economics
  • market economics
  • mergers
  • acquisition
  • assessment
  • european union
  • usa
  • efficiency
  • firms
  • businesses
  • innovations

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