asymmetric firms, restructuring, and entry. We show how these welfare effects depend on the initial level of market development …, and restructuring and entry costs. The model generates an endogenous demand for infrastructure investment, and the … simulate the relative welfare effects of reducing transport, restructuring and entry costs, and we evaluate in each case the …

How does firm entry affect innovation incentives and productivity growth in incumbent firms? Micro-data suggests that … there is heterogeneity across industries - incumbents in technologically advanced industries react positively to entry, but … not in laggard industries. To explain this pattern, we introduce entry into a Schumpeterian growth model with multiple …

incentives for relatively low-cost firms to enter the market, and thus improves the efficiency of the entry process. The … among firms, the proportion of high-cost firms, the cost of restructuring, and entry costs for new firms. …