Models of endogenous growth have not been able to account for the variety of empirically observed distributional properties of the returns to innovation, in part, because of the limitations necessarily imposed on competition to cope with increasing returns to scale. Exponential growth, fat...

We present a model in which price dispersion allows long run increasing returns to scale to emerge from a competitive short run. The model hinges upon turnover in the productive technology-leading firm, price dispersion resultant of Stigler's logic of rational search and limited excludability of...

The distribution of equity returns exhibits skewness and kurtosis. These two stylized facts are embedded in the multivariate volatility distribution of equity returns and are important in measuring the risk of an equity portfolio. In order to capture these attributes while estimating the...