Seminarios académicos y conferencias
Mergers in Innovative Industries
Using a model of sequential innovations with free entry, we investigate how an R&D-enhancing merger affects market outcomes over time. In our baseline model, we find that a merger is welfare-improving as it weakly increases the arrival rate of new products and decreases industry-wide R&D expenditure, despite a reduction in the equilibrium number of firms performing R&D. We find that these same results hold in many of the extensions of the model including quality competition, price competition, and various forms of patent protection. An exception is when the industry presents entry frictions, in which case we provide a criterion for merger approval.
9 Junio 2015 - 17 hrs.
Sala 209, Facultad de Ciencias Económicas y Administrativas UCVer investigación