Merger Policy in the E-conomy (ePub)

Bachelor Thesis from the year 2002 in the subject Law - Civil / Private, Trade, Anti Trust Law, Business Law, grade: First Class, University of Strathclyde (Strathclyde Business School - Law School), course: Strathclyde Business School, language: English, abstract: This paper addresses the economic policy context surrounding the
European merger regulation in high-tech industries. The rapidity of
technological change raises questions as to the operation of the
dynamic parameters underlying high-tech industries. While the
identification of those parameters appears to be straightforward, the
interpretation of the effects posed by the dynamics is rather
controversial.
On the one hand, it is argued that the very dynamics of high-tech
industries create or strengthen dominant companies whereby
consumers run the risk of adopting inefficient technologies.
However, the present paper is to contest this reasoning since
performance competition and the resultant Schumpeterian process of
disequlibria makes a so-called lock-in unlikely. The second chapter is to identify the distinctive parameters of hightech
industries, whereby a contrasting analysis between the two
dimensions of economic performance, establishes dynamic
competition as best utilised to serve the furtherance of consumer
welfare. The third chapter is to consider the implications of dynamic
competition for current relevant market definition by discussing the
deficiencies of current practice. Recent competitive developments
appear to confirm a broad, intermarket and technologies-based
competition among firms. The fourth chapter, therefore, seeks to
propose analytical tools that are capable of evaluating the state of
competition more accurately. To that end, the cornerstones of
relevant market definition are redefined by including a performance
based test, an enquiry into capability explanations and the setting of
time frames to assess entry competition. The final chapter is to conclude that although Schumpeterian
dynamic competition deals with the expectation of innovation, the
proposed analysis is the more accurate approach to intermarket
competition. The goal of this paper is to provide a pragmatic
framework that assists merger analysis in evaluating the ongoing transformation of industrial organisation in the high-tech
environment.