Competition Enforcement and Accounting for Intangible Capital
Abstract
ABSTRACT Antitrust laws mandate review of mergers and acquisitions (M&As) that exceed an asset size threshold based on accounting standards that exclude most intangible capital. We show that this exclusion leads to thousands of intangible‐intensive M&As being nonreportable. Acquirers in nonreportable deals achieve higher equity values and price markups, especially when consolidating product markets. Furthermore, nonreportable pharmaceutical deals are three times more likely to involve overlapping drug projects, which are subsequently 40% more likely to be terminated. Our results suggest that the growth of intangible assets may exacerbate market power through nonreportable consolidation of the sectors most concerning for consumers.
Fields of Study & Subjects
Corporate Finance and Governance
Intellectual Property and Patents
Intellectual Capital and Performance Analysis
Publication details
- Journal / source
- The Journal of Finance
- Publisher
- Wiley
- Volume
- 81
- Issue
- 3
- Pages
- 1217–1263
- Publication date
- 6 February 2026
- Language
- EN