WASHINGTON—Following the introduction of the Prohibiting Anticompetitive Mergers Act by Sen. Elizabeth Warren (D-MA) and Rep. Mondaire Jones (D-NY) on Wednesday, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, released the following statement from Julie Carlson, ITIF’s associate director of the Schumpeter Project on Competition Policy:
Policymakers keep focusing on the misguided notion that concentration in the U.S. economy has increased and that it’s harmful to consumers, workers, and entrepreneurs. This is not true—concentration has not increased, yet lawmakers persist in their attempts to block mergers that promote innovation, economic growth, and the competitiveness of the U.S. economy.
Mergers and acquisitions have an important impact on start-up innovation. Over the last 10 years, more than 70 percent of venture-backed start-up exits were through acquisition. The ability to acquire other firms allows innovations to be diffused throughout the economy more quickly and at a lower cost.
If lawmakers want to “bring down prices” and “build a more vibrant economy,” they should recognize mergers are important for enabling investment in R&D that drives innovation and competition.
- Julie Carlson, “The Platform Competition and Opportunity Act Is a Solution in Search of a Problem” (ITIF Report, January 31, 2022).
- Aurelien Portuese and Julie Carlson, “Comments to the Justice Department and FTC Regarding Merger Enforcement” (March 16, 2022).