costs has no impact at all, in steady-state, on firms' investments in process innovation. We then show that if only a subset … of firms export, a decline in marginal trade costs raises process innovation in exporting firms relative to that of non …-exporting firms. This reallocation of process innovation reinforces existing patterns of comparative advantage, and leads to an …

, will undermine intellectual property rights and dull the incentives for investment in research-intensive industries such as … pharmaceuticals. We challenge this orthodox view and show, to the contrary, that the pace of innovation often is faster in a world …