Innovation and new technologies are the driving force for growth. This was stated by Salvatore Rossi, opening the proceedings of the conference organized by the Bank of Italy, CEPR and Eief on "Industrial dynamics and economic growth". "Innovation and the adoption of new technologies by the largest possible number of companies - said the general manager of Bankitalia opening the conference - are the main source of economic growth and job creation in the economy ”.
“In this context – he continued – the mechanism of entry, survival, growth and exit of companies, which the market uses to select the most efficient and innovative players – adds Rossi – plays a fundamental role. It is the new and young enterprises that drive the accumulation of inputs and the growth of the product. If the most productive firms prosper and the least productive ones exit the market in an orderly manner, the economic system works correctly”.
This is the healthiest dynamism. Sometimes, however, the virtuous mechanism gets stuck. "Barriers to entry or direct and indirect public contributions to companies in difficulty, for example, can mitigate the social costs of crises in the short term, but can have negative effects on the selection of companies and on economic growth in the long term".
