Working Paper: NBER ID: w10323
Authors: Klaus Gugler; Ralph Siebert
Abstract: Merger control authorities may approve a merger based on a so-called 'efficiency defence'. An important aspect in clearing mergers is that the efficiencies need to be merger-specific. Joint ventures, and in particular research joint ventures (RJVs), may achieve comparable efficiencies possibly without the anti-competitive (market power) effects of mergers. We present evidence for the semiconductor industry that RJVs indeed represent viable alternatives to mergers. We empirically account for the endogenous formation of mergers and RJVs.
Keywords: mergers; research joint ventures; semiconductor industry; market power; efficiency
JEL Codes: L13; L49; L63
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| mergers (G34) | market share (L17) |
| RJVs (L24) | market share (L17) |
| higher expected market shares (L19) | likelihood of engaging in mergers and RJVs (L24) |