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Competition and Growth in an Endogenous Growth Model with Expanding product Variety without Scale Effects Revisited

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Author Info
Bianco, Dominique

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Abstract

This paper shows that the results of Bianco (2006) depend critically on the assumption that there are no difference between the intermediate goods share in final output, the returns of specialization and the degree of market power of monopolistic competitors. In this paper, we disentangle the market power parameter from the intermediate goods share in final output and the returns to specialization. The main result of this paper is the death of the inverted-U shape relationship between competition and growth. Indeed, we find a decreasing relationship between competition and growth which is due to the composition of two negative effects on growth : resource allocation and Schumpeterian effects.

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File URL: http://mpra.ub.uni-muenchen.de/16670/
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Publisher Info
Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 16670.

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Date of creation: Aug 2009
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Handle: RePEc:pra:mprapa:16670

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Related research
Keywords: Endogenous growth; Horizontal differentiation; Technological change; Imperfect competition.;

Other versions of this item:

Find related papers by JEL classification:
O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Gino Gancia & Fabrizio Zilibotti, 2005. "Horizontal Innovation in the Theory of Growth and Development," Economics Working Papers 831, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
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  2. Elias Dinopoulos & Peter Thompson, 1999. "Scale effects in Schumpeterian models of economic growth," Journal of Evolutionary Economics, Springer, vol. 9(2), pages 157-185. [Downloadable!] (restricted)
  3. Bianco, Dominique, 2007. "An inverted-U relationship between product market competition and Growth in an extended romerian model : A comment," MPRA Paper 4492, University Library of Munich, Germany. [Downloadable!]
  4. Bianco, Dominique, 2007. "Competition and Growth in an Endogenous Growth Model with Expanding Product Variety without Scale Effects," MPRA Paper 6179, University Library of Munich, Germany, revised 08 Dec 2007. [Downloadable!]
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This page was last updated on 2009-11-30.

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