The Economics of Innovation Spaces
Keywords:
Competition, Innovation Space, Innovation Market, Future Markets Model, Future Market, Dow/Dupont, Bayer/Monsanto, Market Definition Notice, Competition in R&D, research and development marketsAbstract
The European Commission cannot find an Innovation Space. While the Commission claims in its Market Definition Notice that it can do just this, in reality it protects competition to innovate by protecting competition in a Future Market, a market for products at least some of which do not exist yet. This article shows, first, that in the cases in which the Commission claims it has found an Innovation Space, most particularly Dow/Dupont and Bayer/Monsanto, it has actually found a Future Market. Further, when the Commission protects competition in a Future Market it applies the same analytical framework as its American counterparts. To analyse the Future Market the Commission applies the Future Markets Model. Then, after balancing all appropriate variables, it will, just like its Amerian counterparts, act to protect competition in the Future Market if it believes the need to do so is more than ‘speculative’. The Commission will thus act, when it believes it must, to ensure that the Future Market remains competitive. And it assumes that the competitive pressures it is preserving will drive firms to innovate. This is how the Commission has always protected competition to innovate. And, despite what it says in its Market Definition Notice, all it can do.
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