This Paper shows that predation might help firms overcome the free riding problem of mergers by changing the acquisition situation in the buyer's favour relative to the firms outside the merger. It is also shown that the bidding competition for the prey's assets is most harmful to predators when...

Many governments promote small businesses for the dual reasons of fostering `break-through' innovations and employment growth. In this paper we study the effects of tax and subsidy policies on entrepreneurs' choice of riskiness of an innovation project and on their mode of commercializing the...