In this paper shown how tougher competition, generated by large market size or trade, induces stronger incentives to reduce marginal cost for the more-productive firms while the opposite holds for the less-productive firms; this further affects the selection of heterogeneous producers into the domestic and foreign markets.
Many scientists underline the importance of the clusters as agglomerated industries, working for the same purpose with joined resources and potential. This article analyses the basic assumptions which turn organizations to be clustered: the Productivity and the Competitiveness.
Research and development (R&D) and innovations derived from R&D have been argued to be the engine of economic growth for hundreds of years. With supporting data, the paper establishes the vital role of innovation in the value chain and sustainable growth of economies