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Competition And Economic Growth: A Critical Survey Of The Theoretical Literature

Listed author(s):
  • Alessandro D. SCOPELLITI

The paper examines the relationship between competition and economic growth, in the theoretical framework described by endogenous growth models, but with a specific interest in the policy implications. In this perspective, the key issue in the debate can be presented as follows: do competition policies always create the best conditions for promoting innovation and growth? Or do they also produce some disincentives for the investment decisions in R&D, such to limit the development of industries with higher innovation? In order to answer these questions, the paper presents a survey of the theoretical literature on competition and growth and it discusses the main models of endogenous growth, both the ones based on horizontal innovation, and the ones based on vertical innovation. In particular, specific attention is paid to the most recent models of Schumpeterian growth, which show the existence of a non-linear relationship between competition and growth, by considering either the initial degree of competition or the distance from the technological frontier. Finally, the review of the previous models of endogenous growth allows drawing some conclusions about further and possible developments of research on the relation between product market competition and economic growth.

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Article provided by Spiru Haret University, Faculty of Financial Management and Accounting Craiova in its journal Journal of Applied Economic Sciences.

Volume (Year): 5 (2010)
Issue (Month): 1(11)_Spring2010 ()
Pages: 70-93

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Handle: RePEc:ush:jaessh:v:5:y:2010:i:5(1)_spring2010:p:95
Contact details of provider: Web page: http://www2.spiruharet.ro/facultati/facultate.php?id=14

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  1. Nickell, Stephen J, 1996. "Competition and Corporate Performance," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 724-746, August.
  2. Geroski, Paul A., 1995. "Market Structure, Corporate Performance, and Innovative Activity," OUP Catalogue, Oxford University Press, number 9780198288558.
  3. John Scott, 1984. "Firm versus Industry Variability in R&D Intensity," NBER Chapters, in: R&D, Patents, and Productivity, pages 233-248 National Bureau of Economic Research, Inc.
  4. Oecd, 2004. "Competition Policy in Subsidies and State Aid," OECD Journal: Competition Law and Policy, OECD Publishing, vol. 6(1), pages 109-173.
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  7. repec:cdl:agrebk:297792 is not listed on IDEAS
  8. Jones, Charles I, 1995. "R&D-Based Models of Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 759-784, August.
  9. Dominique Bianco, 2009. "Growth And Competition In A Model Of Human Capital Accumulation And Research," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 4(3(9)_Fall).
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  12. Howitt, Peter & Griffith, Rachel & Aghion, Philippe & Blundell, Richard & Bloom, Nick, 2005. "Competition and Innovation: An Inverted-U Relationship," Scholarly Articles 4481507, Harvard University Department of Economics.
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  14. 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.
  15. Marco, Alan C. & Rausser, Gordon C., 2008. "AJAE Appendix: The Role of Patent Rights in Mergers: Consolidation in Plant Biotechnology," American Journal of Agricultural Economics Appendices, Agricultural and Applied Economics Association, vol. 90(1), February.
  16. Daron Acemoglu & Philippe Aghion & Fabrizio Zilibotti, 2002. "Distance to Frontier, Selection, and Economic Growth," NBER Working Papers 9066, National Bureau of Economic Research, Inc.
  17. Roberto Cellini & Guido Cozzi, 2005. "Intellectual Property, Competition and Growth: An Introduction," Rivista di Politica Economica, SIPI Spa, vol. 95(5), pages 3-6, September.
  18. Judd, Kenneth L, 1985. "On the Performance of Patents," Econometrica, Econometric Society, vol. 53(3), pages 567-585, May.
  19. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
  20. Philippe Aghion & Diego Comin & Peter Howitt, 2006. "When Does Domestic Saving Matter for Economic Growth?," NBER Working Papers 12275, National Bureau of Economic Research, Inc.
  21. Mathias Dewatripont & Philippe Aghion & Patrick Rey, 1997. "Corporate governance, competition policy and industrial policy," ULB Institutional Repository 2013/9613, ULB -- Universite Libre de Bruxelles.
  22. Alan C. Marco & Gordon C. Rausser, 2008. "The Role of Patent Rights in Mergers: Consolidation in Plant Biotechnology," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(1), pages 133-151.
  23. An, Galina & Iyigun, Murat F., 2004. "The export skill content, learning by exporting and economic growth," Economics Letters, Elsevier, vol. 84(1), pages 29-34, July.
  24. Ben Gardiner & Ron Martin & Tyler Peter, 2004. "Competitiveness, Productivity and Economic Growth across the European Regions," ERSA conference papers ersa04p333, European Regional Science Association.
  25. Levin, Richard C & Cohen, Wesley M & Mowery, David C, 1985. "R&D Appropriability, Opportunity, and Market Structure: New Evidence on Some Schumpeterian Hypotheses," American Economic Review, American Economic Association, vol. 75(2), pages 20-24, May.
  26. Alberto Bucci, 2003. "Market Power and Aggregate Economic Growth in Models with Endogenous Technological Change," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 62(2), pages 241-291, October.
  27. Gancia, Gino & Zilibotti, Fabrizio, 2005. "Horizontal Innovation in the Theory of Growth and Development," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 3, pages 111-170 Elsevier.
  28. Motta,Massimo, 2004. "Competition Policy," Cambridge Books, Cambridge University Press, number 9780521016919, December.
  29. Luis A. Rivera-Batiz & Paul M. Romer, 1991. "Economic Integration and Endogenous Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 531-555.
  30. Richard Blundell & Rachel Griffith & John van Reenen, 1999. "Market Share, Market Value and Innovation in a Panel of British Manufacturing Firms," Review of Economic Studies, Oxford University Press, vol. 66(3), pages 529-554.
  31. Aghion, Philippe & Harris, Christopher & Vickers, John, 1997. "Competition and growth with step-by-step innovation: An example," European Economic Review, Elsevier, vol. 41(3-5), pages 771-782, April.
  32. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, September.
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