Redo the analysis of the schleifer vishny model

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Reference no: EM131248096

Investment externalities in an industry with decreasing returns to scale:

Suppose that the entrepreneur's limited attention, say, induces decreasing returns to scale.

Income in the case of success is R(I), whereR (∞) = 0.

Redo the analysis of the Schleifer-Vishny model with this modification, and determine the sign of the investment externality.

Reference no: EM131248096

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