Do Business Cycles Influence Long-Run Growth? The Effect of Aggregate Demand on Firm-Financed R&D Expenditures

This paper finds that inventive activity, as measured by firm-financed R&D expenditures, is procyclical. In addition, the "lost" R&D during recessions is larger than the "extra" R&D during expansions so the overall effect of the business cycle is to reduce firm-financed R&D during the 1957 5o 1999 period. The results suggest that a business cycle activity might influence the long-run growth rate of an economy by reducing firm-financed R&D and productivity growth.

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Year of publication:	2003
Authors:	Rafferty, Matthew
Published in:	Eastern Economic Journal. - Eastern Economic Association - EEA, ISSN 0094-5056. - Vol. 29.2003, 4, p. 607-618
Publisher:	Eastern Economic Association - EEA
Subject:	Business Cycle \| Cycle \| Expansion \| Growth \| Procyclical \| Productivity \| R&D \| Recession

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	E32 - Business Fluctuations; Cycles ; O32 - Management of Technological Innovation and R&D ; O47 - Measurement of Economic Growth; Aggregate Productivity
Source:	RePEc - Research Papers in Economics

Persistent link: https://ebvufind01.dmz1.zbw.eu/10005641572