Five not so Easy Pieces to Make Antitrust Work for Innovation

By Richard Gilbert –  

Innovation is an important concern for merger policy in high technology industries. While the antitrust laws are sufficiently flexible to address issues in the R&D-intensive sectors of the economy, there are several practical obstacles to effective antitrust enforcement for innovation. These include: (i) limited economic theory and empirical evidence relating mergers to innovation effects; (ii) the historical importance of market definition in merger analysis; (iii) the standard of proof to establish antitrust harm; (iv) the treatment of efficiencies and appropriability; and (v) limited evidence on the effectiveness of merger remedies to restore innovation incentives.

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