On the cyclicality of R&D
Subtitle: disaggregated evidence
By: by Min Ouyang
Contributors: Federal Reserve Bank of Cleveland
Series: Working paper -- WP07-07R; Working paper (Federal Reserve Bank of Cleveland : Online) -- WP07-07R.
Publisher: Federal Reserve Bank of Cleveland
Published: 2007
Place of publication: Cleveland, Ohio]
Language: eng
Format: [electronic resource] :
Description: "This paper explores the link between short-run cycles and long-run growth by examining the cyclicality of R&D.  Existing theories propose that R&D is concentrated when output is low, but aggregate data repeatedly show that R&D appears procyclical.  We estimate the relationship between R&D and output at the disaggregated industry level, using an annual panel of 20 U.S.  manufacturing industries from 1958 to 1998.  The results indicate that R&D is in fact procyclical, but interestingly, estimates using demand-shift instruments suggest that R&D responds asymmetrically to demand shocks.  We discuss the possibilities that liquidity constraints and technology improvement cause the observed procyclicality of R&D"--Federal Reserve Bank of Cleveland web site.
Notes: Title from PDF file as viewed on 10/29/2007.

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