Research papers on innovation activity share the view that whenever an invention is made available by a startup innovator, getting its ownership by acquisition is beneficial for incumbent firms. In this note, I show by means of an example that there are some circumstances in which accomodating entry and competing with the innovator in the product market can be substantially more profitable than blocking her entry via acquisition.
Preemptive acquisition and downgrading innovation / Tarola, Ornella. - In: ECONOMICS BULLETIN. - ISSN 1545-2921. - 31:2(2011), pp. 1520-1529.
Preemptive acquisition and downgrading innovation
TAROLA, Ornella
2011
Abstract
Research papers on innovation activity share the view that whenever an invention is made available by a startup innovator, getting its ownership by acquisition is beneficial for incumbent firms. In this note, I show by means of an example that there are some circumstances in which accomodating entry and competing with the innovator in the product market can be substantially more profitable than blocking her entry via acquisition.File allegati a questo prodotto
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