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Uncertainty-Induced Reallocations and Growth / Ravi Bansal, Mariano Max Croce, Wenxi Liao, Samuel Rosen.
- Format:
- Book
- Author/Creator:
- Bansal, Ravi.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w26248.
- NBER working paper series no. w26248
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2019.
- Summary:
- Focusing on both micro and aggregate U.S. data, we show the existence of a significant link between aggregate uncertainty and reallocation of resources away from R&D-intensive capital. This link is important because a decrease in the aggregate share of R&D-oriented capital forecasts lower medium-term growth. In a multi-sector production economy in which (i) growth is endogenously supported by risky R&D investments, and (ii) the representative agent is volatility-risk averse and has access to other safer technologies that do not support growth, uncertainty shocks have a first-order negative impact on medium-term growth and welfare.
- Notes:
- Print version record
- September 2019.
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