The Internet plays a growing role in the economy. This paper extrapolates this trend and analyses a world where most … because of the resources diverted away from R and D into advertising. But these mechanisms generate opposite level effects on …

This paper analyzes the implications of advertising for firm dynamics and economic growth through its interaction with … advertising decisions. We calibrate the model to match several empirical regularities across firm size using U.S. data. Through a … novel interaction between R&D and advertising, our model provides microfoundations for the empirically observed negative …