Tyler Cowen, Columnist

People Aren't Thinking Straight About Bayer and Monsanto

Takeovers tend to destroy value. That matters more than a corporate popularity contest.

September 19, 2016 at 2:45 PM UTC

Tyler Cowen is a Bloomberg Opinion columnist, a professor of economics at George Mason University and host of the Marginal Revolution blog.

Popularity contest.
Photographer: Steve Schapiro/Corbis via Getty Images

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Bayer’s proposed purchase of Monsanto, the biggest deal of the year so far, has led to a heated public debate over economic concentration. Unfortunately, both sides are failing to identify the key issues behind the potential transaction.

The good news is that the deal announced on Sept. 14 would not increase market concentration by much. Bayer is primarily a pharmaceutical and health care company whereas Monsanto deals in crop chemicals and seeds.