Market Structure and R&D expenditures In Iranian large manufacturing industries

A fundamental issue in industrial organization theory is how different market structures affect economic performance and social welfare and what market structure is most conducive to innovation and technological progress? This paper aims to conduct a new empirical assessment of the Schumpeterian hypothesis asserting the advantage of monopoly structure over competition structure in raising R&D and technological progress. To this aim, a panel of 4-digit ISIC of Iranian industries data over the period 1995-2007 has been used. The findings of this study support the Schumpeterian hypothesis in Iranian large manufacturing industries in winch the more concentrated industries stimulate R&D expenditures and promote rapid technological progress.