Innovation, mergers, and the limits of the competitiveness narrative
File(s)
Accepted version
Author(s)
Valletti, Tommaso
Type
Journal Article
Abstract
The Draghi report on European competitiveness has reignited a familiar debate. Its diagnosis – that Europe suffers from fragmented markets, underinvestment, and an inability to scale – has been widely accepted. One of the policy conclusions drawn from it, not always by Draghi himself but certainly by those invoking his authority, is that merger control should be relaxed to allow European firms to grow larger and compete globally. The implicit promise is one of efficiencies and innovation: bigger firms, so the argument goes, invest more, innovate more, and ultimately
serve consumers better. This is a seductive narrative. It is also an empirically contested one. And it is precisely at this juncture, when political momentum risks outpacing analytical rigour, that clarity from economics is most needed.
serve consumers better. This is a seductive narrative. It is also an empirically contested one. And it is precisely at this juncture, when political momentum risks outpacing analytical rigour, that clarity from economics is most needed.
Date Acceptance
2026-03-19
Citation
Wirtschaft und Wettbewerb
ISSN
0043-6151
Publisher
Düsseldorf: Handelsblatt
Journal / Book Title
Wirtschaft und Wettbewerb
Copyright Statement
Copyright © 2026 Copyright Owner. This is the author’s accepted manuscript made available under a CC-BY licence in accordance with Imperial’s Research Publications Open Access policy (www.imperial.ac.uk/oa-policy)
License URL
Publication Status
Accepted
Coverage Spatial
Germany
Date Publish Online
2026-03-23