. Although the dual need for original solutions and cost reductions has been identified, a lack of innovation has been pointed … innovations. We also show that a low cost perspective can bring benefits to the sector as a powerful innovation driver. …

competition on R&D to the cost of innovation. The effect of competition on R&D is an inverted U-shape. However, the shape is … flatter and competition policy is therefore less relevant for innovation when innovations are relatively costly. Intuitively …, if innovations are costly for a firm, competitive shocks have to be significant to alter its innovation decisions …