Endogenous fluctuations with procyclical R&D

Shunsuke Shinagawa

Economic Modelling, 2013, vol. 30, issue C, 274-280

Abstract: The literature on endogenous growth cycles predicts the countercyclical allocation of resources to R&D. However, this prediction is not supported by empirical studies. This study considers the R&D-based growth model with endogenous fluctuations introducing population growth and a negative externality that affects the productivity of R&D. We show that this simple modification makes R&D investment procyclical along sustained business cycles using both an overlapping generation framework and an infinitely-lived agent framework.

Keywords: R&D-based growth model; Cyclical properties of R&D expenditure; Endogenous fluctuations; Semi-endogenous growth (search for similar items in EconPapers)
JEL-codes: E32 O11 O41 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:30:y:2013:i:c:p:274-280

DOI: 10.1016/j.econmod.2012.09.024

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