We develop a dynamic stochastic general-equilibrium model of science, education and innovation to explain the … simultaneous emergence of innovation clusters and stochastic growth cycles. Firms devote human-capital resources to research … sustainable process of innovation and scale-invariant growth. Jumps in human capital, triggered by scientific breakthroughs …

dichotomous Innovation data at the firm level by using a bivariate dynamic random effects probit model. The data set, provided by …