must then become larger to break even, which facilitates amortizing the fixed costs of innovation. We demonstrate our …

endogenous share opts for innovation and faces credit constraints in the subsequent expansion phase. We emphasize four results …: (i) R&D subsidies not only encourage innovation but also relax finance constraints and help innovative firms to exploit … investment of constrained firms by reducing free cash-flow and thereby discourage innovation. (iii) A revenue neutral increase in …

regard to the capital gains tax, innovation subsidy, public R&D spending and other policy initiatives. …

We study the interplay between transportation infrastructure, knowledge flows, and innovation. Exploiting historical … variation, we estimate the effect of U.S. interstate highways on regional innovation. We find that a 10% increase in a region … flow of local knowledge and allow innovators to access more distant knowledge inputs. This finding suggests that …

externalities and their impact on regional innovation. We examine MSA-level patent data during the period 1975-2000 and find that … innovation output is higher in regions where large and small firms coexist. The finding is robust to across-region as well as …