Mergers as Reallocation
27 Pages Posted: 19 Oct 2002 Last revised: 10 May 2021
Date Written: October 2002
We argue that takeovers have played a major role in speeding up the diffusion of new technology. The role that they play is similar to that of entry and exit of firms. We focus on and compare two periods: 1890-1930 during which electricity and the internal combustion engine spread through the U.S. economy, and 1971-2001 . the Information Age.
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