Abstract
Schumpeterian growth theory features quality-improving innovations that displace previous technologies, and are motivated by prospective monopoly rents. It predicts, first, that a higher rate of growth should be associated with a higher rate of firm entry and exit, and that exit can enhance productivity growth; second, that some countries may converge to the technological frontier whereas others may diverge; third, that a given policy will have contrasting effects on sectors or countries at different distances from the frontier, and therefore growth policy must be adapted accordingly. In particular, entry and delicensing enhance growth more the closer sectors or countries are to the technological frontier.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Bibliography
Acemoglu, D., P. Aghion, and F. Zilibotti. 2006. Distance to frontier, selection, and economic growth. Journal of the European Economic Association 4: 37–74.
Aghion, P., N. Bloom, R. Blundell, R. Griffith, and P. Howitt. 2005d. Competition and innovation: an inverted-U relationship. Quarterly Journal of Economics 120: 701–728.
Aghion, P., R. Blundell, R. Griffith, P. Howitt, and S. Prantl. 2004. Entry and productivity growth: evidence from micro-level panel data. Journal of the European Economic Association 2: 265–276.
Aghion, P., Blundell, R., Griffith, R., Howitt, P., and Prantl, S. 2005c. The effects of entry on incumbent innovation and productivity. Working Paper No. 12027. Cambridge, MA: NBER.
Aghion, P., R. Burgess, S. Redding, and F. Zilibotti. 2005a. Entry liberalization and inequality in industrial performance. Journal of the European Economic Association 3: 291–302.
Aghion, P., and P. Howitt. 1992. A model of growth through creative destruction. Econometrica 60: 323–351.
Aghion, P., and P. Howitt. 1998. Endogenous growth theory. Cambridge, MA: MIT Press.
Aghion, P., P. Howitt, and D. Mayer-Foulkes. 2005b. The effect of financial development on convergence: theory and evidence. Quarterly Journal of Economics 120: 173–222.
Frankel, M. 1962. The production function in allocation and growth:A synthesis. American Economic Review 52: 995–1022.
Gerschenkron, A. 1962. Economic backwardness in historical perspective. Cambridge, MA: Harvard University Press.
Ha, J., and P. Howitt. 2006. Accounting for trends in productivity and R&D: A Schumpeterian critique of semi-endogenous growth theory. Journal of Money, Credit, and Banking 39: 733–774.
Helpman, E. 1993. Innovation, imitation, and intellectual property rights. Econometrica 61: 1247–1280.
Howitt, P., and D. Mayer-Foulkes. 2005. R&D, implementation and stagnation: A Schumpeterian theory of convergence clubs. Journal of Money, Credit and Banking 37: 147–177.
Lucas, R. 1988. On the mechanics of economic development. Journal of Monetary Economics 22: 3–42.
Nickell, S. 1996. Competition and corporate performance. Journal of Political Economy 104: 724–746.
Nicoletti, G., and S. Scarpetta. 2003. Regulation, productivity and growth. Economic Policy 36: 11–72.
Romer, P. 1986. Increasing returns and long-run growth. Journal of Political Economy 94: 1002–1037.
Romer, P. 1990. Endogenous technical change. Journal of Political Economy 98: 71–102.
Sapir, A., et al. 2003. An agenda for a growing Europe. Oxford: Oxford University Press.
Tirole, J. 1988. The theory of industrial organization. Cambridge, MA: MIT Press.
Author information
Authors and Affiliations
Editor information
Copyright information
© 2018 Macmillan Publishers Ltd.
About this entry
Cite this entry
Aghion, P. (2018). Schumpeterian Growth and Growth Policy Design. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2698
Download citation
DOI: https://doi.org/10.1057/978-1-349-95189-5_2698
Published:
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
eBook Packages: Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences