What Do We Learn from Schumpeterian Growth Theory?
Philippe Aghion, Ufuk Akcigit, Peter Howitt
P. Aghion, S. N. Durlauf (Hrsg.), Handbook of Economic Growth, Band 2B, Amsterdam: North Holland,
2014
Abstract
Schumpeterian growth theory has operationalized Schumpeter’s notion of creative destruction by developing models based on this concept. These models shed light on several aspects of the growth process that could not be properly addressed by alternative theories. In this survey, we focus on four important aspects, namely: (i) the role of competition and market structure; (ii) firm dynamics; (iii) the relationship between growth and development with the notion of appropriate growth institutions; and (iv) the emergence and impact of long-term technological waves. In each case, Schumpeterian growth theory delivers predictions that distinguish it from other growth models and which can be tested using micro data.
Read article
Banking Market Competition, Opaque Firms, and the Reallocation Component of Aggregate Growth
R. Inklaar, Michael Koetter, Felix Noth
Abstract
Read article
Size and Focus of a Venture Capitalist's Portfolio
Paolo Fulghieri, Merih Sevilir
Review of Financial Studies,
No. 11,
2009
Abstract
We take a portfolio approach to analyze the investment strategy of a venture capitalist (VC) and show that portfolio size and scope affect both the entrepreneurs' and the VC's incentives to exert effort. A small portfolio improves entrepreneurial incentives because it allows the VC to concentrate the limited human capital on a smaller number of startups, adding more value. A large and focused portfolio is beneficial because it allows the VC to reallocate the limited resources and human capital in the case of startup failure and allows the VC to extract greater rents from the entrepreneurs. We show that the VC finds it optimal to limit portfolio size when startups have higher payoff potential - that is, when providing strong entrepreneurial incentives is most valuable. The VC expands portfolio size only when startup fundamentals are more moderate and when he can form a sufficiently focused portfolio. Finally, we show that the VC may find it optimal to engage in portfolio management by divesting some of the startups early since this strategy allows him to extract a greater surplus.
Read article
Reallocation of Competences between Local and Higher Levels of Government as so-called „Functional Reforms“: A Case of (De-) Centralization?
Martin T. W. Rosenfeld
Fiscal Decentralization,
1987
Abstract
Read article