The Innovation Theory of Harm: An Appraisal

30 Pages Posted: 24 Mar 2018 Last revised: 17 Apr 2018

Vincenzo Denicolo

University of Bologna

Michele Polo

Bocconi University - Department of Economics

Date Written: March 22, 2018

Abstract

In its recent decision on the Dow-DuPont case, the European Commission has adopted an innovation theory of harm (IToH), which holds that even horizontal mergers whose static effects are benign may be regarded as anticompetitive in a dynamic perspective, as mergers generally stifle innovation. This paper critically assesses the IToH, arguing that its theoretical foundations are too fragile to be the basis for radical policy changes. Antitrust authorities and the courts should continue to consider the impact of horizontal mergers on innovation, bearing in mind that the effect can go either way.

Keywords: Innovation, Mergers, Theory of Harm

JEL Classification: L40

Suggested Citation

Denicolo, Vincenzo and Polo, Michele, The Innovation Theory of Harm: An Appraisal (March 22, 2018). Available at SSRN: https://ssrn.com/abstract=3146731 or http://dx.doi.org/10.2139/ssrn.3146731

Vincenzo Denicolo (Contact Author)

University of Bologna ( email )

Piazza Scaravilli 2
Bologna, 40100
Italy

Michele Polo

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Register to save articles to
your library

Register

Paper statistics

Downloads
281
rank
100,389
Abstract Views
631
PlumX