They are these.
1. "incentives to innovate are mostly driven by the difference between pre- and post-innovation rents."Reducing firms’ market power, for example through antitrust intervention, thus has an ambiguous effect on innovation (it reduces both pre and post innovation rents).What does this mean? Consider a firm who is in a market with a technology that's close to other firms. If competition in the market rises, then it's likely that profits in the existing market will fall: firm's with more common technology are likely to be tougher competitors. Thus the benefits from escaping competition are higher, since the post-innovation market, relative to the now more competitive pre-innovation market, will promise higher incremental profits.
As they say
Innovation incentives depend ...upon the difference between postinnovation and preinnovation rents of incumbent firms. In this case, more competition may foster innovation and growth, because it may reduce a firm’s preinnovation rents by more than it reduces its postinnovation rents. In other words, competition may increase the incremental profits from innovating, and thereby encourage R&D investments aimed at “escaping competition.” This should be particularly true in sectors where incumbent firms are operating at similar technological levels; in these “neck-and-neck” sectors, preinnovation rents should be especially reduced by product market competition. On the other hand, in sectors where innovations are made by laggard firms with already low initial profits, product market competition will mainly affect postinnovation rents, and therefore the Schumpeterian effect of competition should dominate
