Working Paper: CEPR ID: DP14785
Authors: Lus M. B. Cabral
Abstract: I present a cautionary note on the proposal to tighten merger policy in the high-tech space. The discouragement effect on innovation could be significant. This is not to say that increased policy enforcement is not called for. On the contrary. My point is that it should primarily take the form of checking for abuses of dominant position, tightening consumer protection, and directly regulating dominant firms.
Keywords: No keywords provided
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| tightening merger policy (L41) | discouragement of innovation in digital industries (O39) |
| acquisitions in high-tech sectors (L63) | technology transfer and innovation incentives (O31) |
| weaker preemptive motive for acquisitions in digital industries (G34) | less stifling of innovation (O39) |
| stronger enforcement of competition policy against dominant firms (L49) | enabling innovation (O35) |
| tightening merger policy (L41) | stifling of innovation (O36) |