Barriers to Creative Destruction: Large Firms and Nonproductive Strategies

Salome Baslandze

No 2021-23, FRB Atlanta Working Paper from Federal Reserve Bank of Atlanta

Abstract: This working paper reviews recent empirical evidence on large firms and nonproductive strategies that hinder creative destruction and reallocation. The focus is on three types of nonproductive strategies: political connections, nonproductive patenting, and anticompetitive acquisitions. Across different contexts using granular micro data sets, we overwhelmingly see that as firms gain market share, they increasingly rely on nonproductive strategies but reduce their productive, innovation-based strategies. I also discuss theoretical channels, aggregate implications, and potentials for some policies.

Keywords: creative destruction; innovation; growth; patents; political connections; firm dynamics (search for similar items in EconPapers)
JEL-codes: O3 O4 (search for similar items in EconPapers)
Pages: 20
Date: 2021-09-30
New Economics Papers: this item is included in nep-bec, nep-com, nep-cwa, nep-ent, nep-ino, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in 2021

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Related works:
Working Paper: Barriers to Creative Destruction: Large Firms and Non-Productive Strategies (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedawp:93478

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DOI: 10.29338/wp2021-23

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