Firm Characteristics and the Cyclicality of R&D Investments

KOF Swiss Economic Institute Working Paper No. 277

27 Pages Posted: 10 Apr 2011

See all articles by Spyros Arvanitis

Spyros Arvanitis

Swiss Federal Institute of Technology Zurich (ETH) - Swiss Institute for Business Cycle Research (KOF)

Martin Woerter

Swiss Federal Institute of Technology Zurich (ETH) - Swiss Institute for Business Cycle Research (KOF)

Date Written: April 6, 2011

Abstract

Aim of this study is to combine micro-aspects of firm behaviour with macro-aspects of business development and identify market conditions (for example, price competition) and firm characteristics (for example, type of R&D partners) that enable a firm to have a procyclical, anti-cyclical or non-systematic R&D investment behaviour.

New elements of our analysis are: (a) the identification in our data of the above three main types of R&D behaviour with respect to the fluctuation of overall economic activity as measured by a standard composite indicator of the business conditions at industry level and (b) the investigation of a series of hypotheses as to innovation-relevant firm characteristics that underline the three different behaviour categories. The empirical results confirm to large extent our hypotheses and allow us to make profiles of the three types of R&D behaviour.

Keywords: R&D, anti-cyclical behaviour, pro-cyclical behaviour

JEL Classification: O3

Suggested Citation

Arvanitis, Spyros and Woerter, Martin, Firm Characteristics and the Cyclicality of R&D Investments (April 6, 2011). KOF Swiss Economic Institute Working Paper No. 277, Available at SSRN: https://ssrn.com/abstract=1806254 or http://dx.doi.org/10.2139/ssrn.1806254

Spyros Arvanitis (Contact Author)

Swiss Federal Institute of Technology Zurich (ETH) - Swiss Institute for Business Cycle Research (KOF) ( email )

CH-8092 Zurich
Switzerland
+41 44 632 51 68 (Phone)
+41 44 632 13 52 (Fax)

Martin Woerter

Swiss Federal Institute of Technology Zurich (ETH) - Swiss Institute for Business Cycle Research (KOF) ( email )

CH-8092 Zurich
Switzerland

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