This paper sets up an endogenous growth model in which public capital is a productive input and where the intermediate goods sector is characterized by monopolistic competition. The model is used to examine the effects of monopoly power, and the taxation policy on the economic growth rate. Three...

This paper studies the impact of financing constraints in patent races. We develop a model of optimal contracting where firms finance their R&D expenditures with an investor who cannot verify their effort. In equilibrium, firms are more likely to win the more cash and assets they hold prior to...