NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Growth, Slowdowns, and Recoveries

Francesco Bianchi, Howard Kung, Gonzalo Morales

NBER Working Paper No. 20725
Issued in December 2014, Revised in November 2017
NBER Program(s):Economic Fluctuations and Growth, Monetary Economics

We construct and estimate an endogenous growth model with debt and equity financing frictions to understand the relation between business cycle fluctuations and long-term growth. The presence of spillover effects from R&D imply an endogenous relation between productivity growth and the state of the economy. During the 2008 recession, technology utilization dropped precipitously, while R&D investment and long-term TFP growth were less affected. The opposite occurred during the 2001 re- cession. Contractionary shocks to external equity and debt financing are important for explaining the dynamics of the 2001 and 2008 recessions, respectively. Equity financing shocks are more important for explaining R&D investment while debt financing shocks are more important for physical investment.

download in pdf format
   (516 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w20725

Users who downloaded this paper also downloaded* these:
Chabot, Ghysels, and Jagannathan w20660 Momentum Trading, Return Chasing, and Predictable Crashes
Anzoategui, Comin, Gertler, and Martinez w22005 Endogenous Technology Adoption and R&D as Sources of Business Cycle Persistence
Fratto and Uhlig w20707 Accounting for Post-Crisis Inflation and Employment: A Retro Analysis
De Fiore and Uhlig w20730 Corporate Debt Structure and the Financial Crisis
Alfaro, Chari, and Kanczuk w20726 The Real Effects of Capital Controls: Firm-Level Evidence from a Policy Experiment
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us