Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/224202 
Year of Publication: 
2020
Series/Report no.: 
Working Paper No. 358
Publisher: 
University of Zurich, Department of Economics, Zurich
Abstract: 
This paper provides a theory of strategic innovation project choice by incumbents and start-ups. We show that prohibiting killer acquisitions strictly reduces the variety of innovation projects. By contrast, we find that prohibiting other acquisitions only has a weakly negative innovation effect, and we provide conditions under which the effect is zero. Furthermore, for both killer and other acquisitions, we identify market conditions under which the innovation effect is small, so that prohibiting acquisitions to enhance competition would be justified.
Subjects: 
innovation
killer acquisitions
merger policy
potential competition
start-ups
JEL: 
O31
L41
G34
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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