Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322686 
Year of Publication: 
2005
Series/Report no.: 
Discussion Papers Series No. 05-28
Publisher: 
Utrecht University, Utrecht School of Economics, Tjalling C. Koopmans Research Institute, Utrecht
Abstract: 
Using a game theoretical model on firms' simultaneous investments in product and process innovation, we deduct and empirically test hypotheses on the optimal R&D portfolio, investment, performance, and dynamic efficiency of R&D for acquisitions and in independently competing firms. We use Community Innovation Survey data on Italian manufacturing firms. Theoretical and empirical results show that firms involved in acquisitions invest in different R&D portfolios and invest at least as much in aggregate R&D as independent firms. The empirical results do not support our hypothesis on dynamic efficiency since acquisitions lead to inferior R&D performance
Subjects: 
Mergers and Acquisitions
Innovation
Dynamic Efficiency
Cost Reduction
Product Differentiation
Document Type: 
Working Paper

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