Acquisitions

In new research, Semih Üslü and Flavien Moreau argue that waves of mergers and acquisition, which are typically unstable and ultimately crash, are not driven by changes in economic conditions, but by self-reinforcing appetite for mergers among firms when others are also engaging in M&A. Policies that drive stable, low-merger conditions can lead to better outcomes for consumers.

Startups are a major driver of innovation, but many startups are acquired by large incumbents. Do these acquisitions stifle innovation or promote it? While...