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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