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Does Research and Development Intensity Enhance Industrial Growth Performance during Economic Downturns? Inter‐Industry Evidence from Australia
Author(s) -
Tang Sam Hak Kan
Publication year - 2015
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/1467-8462.12116
Subject(s) - shock (circulatory) , r&d intensity , panel data , economics , research development , industrial organization , manufacturing , intensity (physics) , business , econometrics , marketing , management , medicine , paleontology , test (biology) , biology , physics , quantum mechanics
Abstract This article studies the relationship between research and development intensity and growth performance during economic downturns at the industry level. Industries that are more research and development‐intensive tend to perform better during downturns than industries that are less research and development‐intensive. The panel fixed‐effects estimations show that this link is particularly strong among manufacturing industries and is robust to various sensitivity checks. These results are consistent with previous firm‐level studies that find innovating firms are much less sensitive to a particular cyclical shock than are non‐innovating firms.