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Advertising affects firms’ innovation and sales, and long-run economic growth

Cavenaile, Laurent and Roldan-Blanco, Pau (2021) Advertising affects firms’ innovation and sales, and long-run economic growth. LSE Business Review (09 Sep 2021). Blog Entry.

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Abstract

The interaction between advertising and innovation incentives at the firm level can alter aggregate economic measures. When advertising costs decrease, firms reallocate resources away from R&D and towards advertising, hurting long-run economic growth. Laurent Cavenaile and Pau Roldan-Blanco write that understanding the relationship between R&D and advertising might help explain the success of industrial policies aimed at generating economic growth and raising living standards.

Item Type: Online resource (Blog Entry)
Official URL: https://blogs.lse.ac.uk/businessreview/
Additional Information: © 2021 The Authors
Divisions: LSE
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Date Deposited: 02 Nov 2021 15:42
Last Modified: 02 Nov 2021 15:42
URI: http://eprints.lse.ac.uk/id/eprint/112265

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