On the Cyclicality of R&d: Disaggregated Evidence Working Paper 07-07r* on the Cyclicality of R&d: Disaggregated Evidence Introduction

نویسندگان

  • Min Ouyang
  • Randy Becker
  • Stephanie Yang
  • Linda Cohen
  • Larry Christiano
  • Tim Dunne
  • Amihai Glazer
  • David Neumark
  • Peter Rupert
  • Carl Walsh
  • Randy Wright
چکیده

Working papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views stated herein are those of the authors and are not necessarily those of the Federal Reserve Bank of Cleveland or of the Board of Governors of the Federal Reserve System. Min Ouyang is an assistant professor at the University of California at Irvine and a research associate of the Federal Reserve Bank of Cleveland. She thanks Wayne Gray and Randy Becker for kindly providing the extended NBER manufacturing productivity databases, John Shea for his help on input-output instrument selection, and Stephanie Yang for research assistance. 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.

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تاریخ انتشار 2007