Heterogeneous firms, R&D policies and the long shadow of business cycles

Arbeitspapier

Growth and business cycles have a long tradition of being studied separately. However, events such as the Great Recession raise concerns that severe downturns may have detrimental implications for growth. If so, what policies may help alleviate such long-lasting effects of large recessions? To study these questions, we develop a tractable general equilibrium model of endogenous growth featuring heterogeneous firms, financial constraints and a range of innovation policies. A preliminary analysis suggests that counter-cyclical tax credits may serve as a powerful automatic stabilizer alleviating the long-lasting negative effects of severe cyclical downturns.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: JRC Working Papers on Territorial Modelling and Analysis ; No. 04/2021

Classification and Topics

• Classification: Wirtschaft ; Models of Trade with Imperfect Competition and Scale Economies; Fragmentation ; Trade Policy; International Trade Organizations ; Innovation and Invention: Processes and Incentives ; One, Two, and Multisector Growth Models
• Subject: Firm dynamics ; innovation policy ; endogenous growth ; business cycles

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Benedetti-Fasil, Cristiana ; Impullitti, Giammario ; Licandro, Omar ; Sedlácek, Petr
• Event: Veröffentlichung
• (who): European Commission, Joint Research Centre (JRC)
• (where): Seville
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/249188
• Last update: 10.03.2025, 11:44 AM CET