This paper proposes a methodology to investigate the process of technical change with a focus on the dynamic effects of R&D investments on productivity and on the induced innovation hypothesis for both inputs and outputs. The approach builds on a non-parametric representation of the underlying...

Is time-varying firm-level uncertainty a major cause or amplifier of the business cycle? This paper investigates this question in the context of a heterogeneousfirm RBC model with persistent firm-level productivity shocks and lumpy capital adjustment, where cyclical changes in uncertainty...

Using a unique German firm-level data set, this paper is the first to jointly study the cyclical properties of the cross-sections of firm-level real value added and Solow residual innovations, as well as capital and employment adjustment. We find two new business cycle facts: 1) The...

There is a common perception that low productivity or low growth is due to what can be called an `innovation shortfall,` usually identified as a low rate of investment in research and development (RD) compared with some high-innovation countries. The usual reaction to this perceived problem is...