Costa, Luís F.Dixon, Huw D.2010-12-142010-12-142005Costa, Luís F. e Huw D. Dixon. 2005. "A simple business-cycle model with schumpeterian features". Instituto Superior de Economia e Gestão - DE Working papers nº 16-2005/DE/UECE0874-4548http://hdl.handle.net/10400.5/2684We develop a dynamic general equilibrium model of imperfect competition where a sunk cost of creating a new product regulates the type of entry that dominates in the economy: new products or more competition in existing industries. Considering the process of product innovation is irreversible, introduces hysteresis in the business cycle. Expansionary shocks may lead the economy to a new 'prosperity plateau,' but contractionary shocks only affect the market power of mature industries.engEntryHysteresisMark-upworking paper