AbstractsLaw & Legal Studies

Summary of Doctoral Dissertation Assessment of Innovation Effects of Mergers The adequate consideration of innovation effects of mergers in merger review was, and still is, one of the most controversially discussed issues between antitrust scholars. In this connection the question has been raised whether the traditional categories in competition law are sufficiently suitable for dealing with innovation aspects or whether new concepts for the assessment of innovation effects of mergers are needed. This argument relates to the question whether the firms who compete in regard to existing products necessarily play a role in regard to innovation competition. Or, by asking the opposite question, whether there are perhaps additional firms (by also accounting for firms outside the current product market) that actually compete with one another in the sphere of innovation. Thus, although the assessment of product markets as a device to identify the relevant competitors is a well-founded step to protect static price and non-price competition, the sole assessment of the respective product market will probably not reflect the true situation regarding innovation competition. Accordingly, each of the five articles of this thesis builds on the idea that the relevant competitors in terms of innovation do not necessarily correspond to the relevant competitors on existing product markets. From an economic perspective the definition of “markets” was always only a vehicle for identifying the set of relevant competing firms. In a concept of static competition, it was logical to use the set of current products, and analyze their substitutability conditions from the demand and the supply side in order to determine the set of relevant competitors. However, the attempt to stick to the product market concept for defining the relevant competitors for innovation is theoretically deeply flawed. Since the production and sale of products does not require the same resources and capabilities as the generation of innovations, a general assumption of such an identity cannot be defended. This discussion led to the development of the so-called "Innovation Market Analysis" (IMA), an innovation-specific assessment approach, in the 1990s. Even though the IMA was also applied to a significant number of U.S. merger cases in the years thereafter, it was heavily criticized by many lawyers and economists. Hence, it is still not clear how antitrust agencies should deal with innovation aspects in the review process of mergers. This research project assesses how and to what extent the U.S. antitrust authorities in their case practice investigated mergers on possible negative effects on innovation and whether the investigation concepts are appropriate or need to be developed.…