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Merger and product innovation under cross ownership and cooperative R&D

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  • Mukherjee, Arijit

Abstract

We show that merger may increase investments in product innovation, and expected welfare if there is either passive cross ownership or cooperative research. Hence, the antitrust authorities may not need to be too concerned about mergers in these situations.

Suggested Citation

  • Mukherjee, Arijit, 2023. "Merger and product innovation under cross ownership and cooperative R&D," Economics Letters, Elsevier, vol. 233(C).
    • Handle: RePEc:eee:ecolet:v:233:y:2023:i:c:s0165176523004445
    DOI: 10.1016/j.econlet.2023.111418
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    References listed on IDEAS

    as
    1. Denicolò, Vincenzo & Polo, Michele, 2018. "Duplicative research, mergers and innovation," Economics Letters, Elsevier, vol. 166(C), pages 56-59.
    2. Bourreau, Marc & Jullien, Bruno, 2018. "Mergers, investments and demand expansion," Economics Letters, Elsevier, vol. 167(C), pages 136-141.
    3. David Gilo & Yossi Moshe & Yossi Spiegel, 2006. "Partial Cross Ownership and Tacit Collusion," RAND Journal of Economics, The RAND Corporation, vol. 37(1), pages 81-99, Spring.
    4. Federico, Giulio & Langus, Gregor & Valletti, Tommaso, 2017. "A simple model of mergers and innovation," Economics Letters, Elsevier, vol. 157(C), pages 136-140.
    5. Mukherjee, Arijit, 2022. "Merger and process innovation," Economics Letters, Elsevier, vol. 213(C).
    6. Denicolò, Vincenzo & Polo, Michele, 2021. "Mergers and innovation sharing," Economics Letters, Elsevier, vol. 202(C).
    7. Brito, Duarte & Cabral, Luís & Vasconcelos, Helder, 2014. "Divesting ownership in a rival," International Journal of Industrial Organization, Elsevier, vol. 34(C), pages 9-24.
    8. Bettina Becker, 2015. "Public R&D Policies And Private R&D Investment: A Survey Of The Empirical Evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 29(5), pages 917-942, December.
    9. David Gilo & Yossi Moshe & Yossi Spiegel, 2006. "Partial cross ownership and tacit collusion," RAND Journal of Economics, RAND Corporation, vol. 37(1), pages 81-99, March.
    10. Wilson A. Alley, 1997. "Partial Ownership Arrangements and Collusion in the Automobile Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 45(2), pages 191-205, June.
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    Cited by:

    1. Mukherjee, Arijit & Ray, Achintya, 2024. "Pro-competitive merger under R&D revisited," Economics Letters, Elsevier, vol. 239(C).

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    More about this item

    Keywords

    Cooperative R&D; Cross ownership; Merger; Product innovation;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L00 - Industrial Organization - - General - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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