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Competition and Innovation

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Competition and Innovation " Is pure competition or monopoly the best environment for fostering innovation? Actually, neither. The relationship between product market competition and innovation is an inverted U-shape: the "escape competition effect" dominates for low initial levels of competition, whereas the Schumpeterian effect dominates at higher levels of competition. "Competition and innovation: an inverted U relationship". By Phillippe Aghion, Nicholas Bloom, Richard Blundell, Rachel Griffith and Peter Howitt of the Institute for Fiscal Studies.

 

By Institute for Fiscal Studies , UK

Macro Economic Policy Resource.