How do political connections affect firm dynamics, innovation, and creative destruction? To answer this question, we … build a firm dynamics model, where we allow firms to invest in innovation and/or political connection to advance their …

Innovation and technological progress are the key determinants of long-run economic growth and welfare. Therefore, an … important question is, how can public policy encourage more innovation? In this chapter, I review some of the empirical findings … from various recent studies on innovation and firm dynamics that can shed light on the design of innovation policy. The …