Innovating in downturns can affect corporate success by improving a firm’s position relative to competitors during the recovery period. However, increased uncertainty and more binding financial constraints complicate such innovation activity. I find that past experience with innovation during recessions improves a firm’s ability to invest in R&D when a new downturn hits. This result holds controlling for traditional drivers of innovation as cumulated innovations and financial constraints, as well as mitigating endogeneity and selection concerns. Moreover, I find that past experience with innovation during recessions is beneficial to patent outcomes after a new recession. Overall, the paper provides novel evidence on how business cycles shape innovative capabilities.

Companies learning to innovate in recessions

Amore, Mario Daniele
2015

Abstract

Innovating in downturns can affect corporate success by improving a firm’s position relative to competitors during the recovery period. However, increased uncertainty and more binding financial constraints complicate such innovation activity. I find that past experience with innovation during recessions improves a firm’s ability to invest in R&D when a new downturn hits. This result holds controlling for traditional drivers of innovation as cumulated innovations and financial constraints, as well as mitigating endogeneity and selection concerns. Moreover, I find that past experience with innovation during recessions is beneficial to patent outcomes after a new recession. Overall, the paper provides novel evidence on how business cycles shape innovative capabilities.
2015
2015
Amore, Mario Daniele
File in questo prodotto:
File Dimensione Formato  
1-s2.0-S0048733315000827-main.pdf

non disponibili

Tipologia: Pdf editoriale (Publisher's layout)
Licenza: NON PUBBLICO - Accesso privato/ristretto
Dimensione 176.76 kB
Formato Adobe PDF
176.76 kB Adobe PDF   Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/3984562
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 39
  • ???jsp.display-item.citation.isi??? 33
social impact