Mergers and Acquisitions

Mergers and Acquisitions

The Innovation Impact

Edited by Bruno Cassiman and Massimo G. Colombo

This book examines the issue of mergers and acquisitions (M & As) in the context of technological development, and in particular the impact of M & As on the innovation process. In so doing, the book integrates two bodies of literature, on M & As, and on innovation studies, a nexus which the editors contend represents an important step in the advancement of our understanding of both with clear implications for competitive advantage and growth of firms. Drawing on perspectives from both management and economics, the book offers a cohesive blend of theory, methodology, and a wealth of empirical material.

Chapter 5: M & A and Innovation: A Conceptual Framework

Bruno Cassiman and Masako Ueda

Subjects: business and management, organisational innovation, economics and finance, economics of innovation, industrial economics, innovation and technology, economics of innovation, organisational innovation


5. M&A and innovation: a conceptual framework Bruno Cassiman and Masako Ueda 5.1 INTRODUCTION The major conclusion from the existing studies discussed in Chapter 4 is that any results on the relation between mergers and acquisitions (M&A) and the innovation process are weak and/or difficult to generalize. In this chapter we will carefully formulate the possible effects of M&A on the innovation process in a conceptual framework. The contribution of the chapter is to link each of these hypotheses with specific consequences for the research and development (R&D) process and organization. Interestingly, we find that the same M&A can have important conflicting effects on innovation and, therefore, it is not surprising to find these inconclusive results. Chapter 6, then, presents our empirical model, where we condition the M&A along different dimensions, and in Chapters 7 and 8 we demonstrate that these dimensions are indeed relevant for actually understanding the effect of M&A on innovation. Elucidating these key dimensions for gauging the impact of M&A on innovation is, hence, the true contribution of our overall study. 5.2 M&A AND THE INNOVATION PROCESS 5.2.1 Effect of M&A on R&D/Innovation Process and Production Process In Figure 5.1 below, we summarize the basic theoretical framework for this study. While the trends discussed in Chapters 2 and 3 can affect the motivation for M&A, the fundamental link we wish to study is the direct...

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