Référence

Bruno Jullien et Yassine Lefouili, « Mergers and Investments in New Products », TSE Working Paper, n° 18-949, août 2018.

Résumé

We investigate the impact of a horizontal merger between two competitors on their incentives to develop new products. We show that a merger raises the incentives to innovate if and only if the merged entity's incremental gain from a second innovation is larger than the individual profit of an innovator when both firms innovate in the no-merger scenario. Applying this result to the Hotelling model, we find that a merger spurs innovation and can be beneficial to consumers if the degree of product differentiation is positive but not too high.

Mots-clés

Merger Policy; Product Innovation; R&D Investments;

Codes JEL

  • K21: Antitrust Law
  • L13: Oligopoly and Other Imperfect Markets
  • L40: General