Advertising, Innovation, and Economic Growth

• 成果类型: Article
• 署名作者: Cavenaile, Laurent; Roldan-Blanco, Pau
• 署名单位: University of Toronto; University Toronto Scarborough; University of Toronto; Banco de Espana
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.20180461
• 发表日期: 2021
• 页码: 251-303
• 关键词: research-and-development; firm growth; brand extensions; QUALITY; size; MODEL; price; reallocation; PRODUCTIVITY; ORGANIZATION

摘要

This paper analyzes the implications of advertising for firm dynamics and economic growth through its interaction with R&D. We develop a model of endogenous growth with firm heterogeneity that incorporates advertising decisions and calibrate it to match several empirical regularities across firm size. Our model provides micro-foundations for the empirically observed negative relationship between both firm R&D intensity and growth and firm size. In the calibrated model, about half of the deviation from proportional firm growth is attributed to our novel advertising channel. In addition, R&D and advertising are substitutes, a prediction for which we find evidence in the data.