Benkert, Jean-Michel; Letina, Igor; Liu, Shou (October 2023). Startup Acquisitions: Acquihires and Talent Hoarding (Discussion paper series 18376).
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We study how competitive forces may drive firms to inefficiently acquire startup
talent. In our model, two rival firms have the capacity to acquire and integrate
a startup operating in a possibly orthogonal market. We show that firms may
pursue such “acquihires” primarily as a preemptive strategy, even when these transactions appear unprofitable in isolation. Thus, acquihires, even absent traditional
competition-reducing effects, need not be benign as they can lead to inefficient talent allocation. Additionally, our analysis underscores that such talent hoarding can
diminish consumer surplus and exacerbate job volatility for acquihired employees.
Item Type: |
Working Paper |
|---|---|
Division/Institute: |
03 Faculty of Business, Economics and Social Sciences > Department of Economics |
UniBE Contributor: |
Benkert, Jean-Michel Nicolas, Letina, Igor |
Subjects: |
300 Social sciences, sociology & anthropology > 330 Economics |
ISSN: |
0265-8003 |
Series: |
Discussion paper series |
Language: |
English |
Submitter: |
Julia Alexandra Schlosser |
Date Deposited: |
31 Oct 2023 08:23 |
Last Modified: |
31 Oct 2023 08:25 |
BORIS DOI: |
10.48350/188355 |
URI: |
https://boris.unibe.ch/id/eprint/188355 |
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