Competizione e Innovazione: quando teoria ed evidenza empirica raccontano storie diverse

If we wonder ¿which market structure best promotes innovation?¿ the answer to that quest is very controversial because theoretical models seem to be contradicted by the evidence. On the one hand, theories of industrial organization typically predict that more intense product market competition has detrimental effect on innovation as it reduces rents from innovating. On the other hand, common wisdom and empirical evidence finds that it foster innovation growth because tougher competition induces firms to cut costs, reduce slack and innovate in order to preserve their market position. My thesis is an attempt to shed light on the relationship between PMC and innovation activity by reviewing several attempts that many authors made to reconcile theory and evidence.