The Economics of Growth: Innovation, Rivalry, and Institutions

Almost a century ago Joseph A. Schumpeter argued that the capitalist system is an engine of growth driven by technological change and that this is the outcome of market rivalry. Firms continuously strive to improve and defend their market position at the expense of other firms. Modern growth theory provides a unified, consistent framework for modeling this process.

Within the time limits of this course, we will study the foundations of this framework and use the most recent advances in modeling to shed light on old and new questions concerning development and growth. Market imperfections are inherent in this framework and there is a need for institutional corrections. We will integrate government regulations in the framework, which will allows us to think about real-world problems in a novel and more productive way. We will also test certain hypotheses and implications of this framework.


Pietro F. Peretto is Professor at the Department of Economics at Duke University. His fields of interest are Economic Growth, Macroeconomics, Industrial Organisation, and International Economics.

Vahagn Jerbashian is Assistant Professor at the Department of Economics at the University of Barcelona, where he is also a member of Center for Research in Welfare Economics (CREB) and Barcelona Economics Analysis Team (BEAT).

Course outline and schedule

In this course, we will look at three types of innovation by entrepreneurs and firms: (1) development of products and market entry; (2) development of higher quality products than existing ones and market entry with “creative destruction;” and (3) “creative accumulation” within firms, which enhances their productivity and product quality. The main focus of the course is on the third type of innovation, which is more in line with theory and evidence from IO. Download the syllabus here.

Section 1 | Lecturer: Vahagn Jerbashian

1. The preliminaries of endogenous growth theory
2. In-house innovation, patents, licensing, and growth
3. Innovation and rivalry for product market and inputs
4. Competition and innovation: Theory and empirical evidence

Section 2 | Lecturer: Pietro F. Peretto

5. Notable extensions of Peretto-Smulders knowledge-based model
6. Introducing natural resources and richer production structure
7. The multi-sector version of the model
8. Applications and recent extensions: Corporate governance, entry, innovation and growth

This Summer School includes also a workshop where advanced students can present their works and receive feedback.


Dates: July 1st-5th, 2019
Lecture hours: 20 hours

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Certifications & Titles

Summer School at the UB School of Economics is accredited in accordance with the European Credit Transfer System and will be recognized by the University of Barcelona as 2 ECTS credits.


Regular fees: 475 - 710 EUR


General fee: 710 euros
Student fee: 475 euros

Funding Options

Master and PhD students can apply for funding. Deadline for registration including scholarship is April 30th, 2019.


John M. Keynes, 1-11

Barcelona , Spain

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