A Vocabulary for Conversing About Entrepreneurship, Innovation, and Antitrust

• Published date: 01 December 2016
• Author: Albert A. Foer
• Date: 01 December 2016
• DOI: 10.1177/0003603X16676143

Article

A Vocabulary for Conversing

About Entrepreneurship,

Innovation, and Antitrust

Albert A. Foer*

Abstract

As an introduction to the discussion of entrepreneurship, innovation, and antitrust, this article defines

key terms, particularly focusing on the relationship between the concepts of innovation and entre-

preneurship. In the process, the author considers ways in which the antitrust laws may apply to each.

Nearly all the key words were shown to have multiple meanings and usages, forcing us to be as explicit

as possible in assigning varying roles for antitrust to varying meanings of entrepreneurship.

Keywords

innovation, entrepreneurship, competition, skunk works, mergers, unilateral conduct, collusion,

vertical restraints

I. Introduction

Entrepreneur,entrepreneurship,entrepreneurial—beloved words of economists, business schools,

and a certain class of investors. Surprisingly, perhaps, these words have received relatively little direct

attention from antitrust policy makers, despite increasing attention in recent years to the concept of

innovation, which is increasingly viewed as being right up there with low prices and consumer choice

as the triumvirate of values to be protected by enforcement of the antitrust laws. In this introduction, I

will discuss a number of terms and related information that likely will be encountered in this sympo-

sium, as we seek to identify the most appropriate roles of antitrust for entrepreneurship and innovation.

Section II of this article begins with definitions: Who is an entrepreneur? What is innovation? To

what extent do these categories overlap? Section III considers the market conditions facing an entre-

preneur, especially the role of risk. Section IV is about antitrust: What types of actions can incumbents

take to block the entry or growth of a newcomer? We consider horizontal collusion, vertical restraints,

and unilateral actions by dominant firms. Merger controls, market concentration, and exit strategies are

the subjects of Section V. Section VI asks whether it matters if the concept of entrepreneurship applies

when the action takes place within a ‘‘skunk works’’ or R&D shop inside a large firm. Section VII

*The American Antitrust Institute, Washington, D.C., USA

Corresponding Author:

Albert A. Foer, 1730 Rhode Island Avenue, NW Suite 1100, Washington, D.C., WA 20036, USA.

Email: bfoer@antitrustinstitute.org

The Antitrust Bulletin

2016, Vol. 61(4) 479-493

ªThe Author(s) 2016

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DOI: 10.1177/0003603X16676143

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