government provide incentives for innovation in a fiscally sustainable way? We address this question by examining the Ramsey … problem of finding optimal tax and subsidy schemes in a model in which growth is endogenously sustained by risky innovation …. We characterize the shadow value of growth and entry in the innovation sector. We find that a profit tax is required to …

reaching the right tails of the firm size and innovation distributions. Furthermore, outcomes are better for startups matched …

How do political connections affect firm dynamics, innovation, and creative destruction? To answer this question, we … build a firm dynamics model, where we allow firms to invest in innovation and/or political connection to advance their …