Must-Read: Maarten de Ridder and Coen Teulings: Endogenous growth and lack of recovery from the Global Crisis

Must-Read: Maarten de Ridder and Coen Teulings: Endogenous growth and lack of recovery from the Global Crisis: “The crisis [is] a quasi-natural experiment to test the endogenous growth hypothesis… http://voxeu.org/article/endogenous-growth-and-lack-recovery-global-crisis

…suggests that output has not recovered because the crisis affected the rate of technological progress. Firms that preferred a bank that was more severely affected by the crisis experienced a large fall in R&D investment and a persistent fall in output in subsequent years. This suggests a direct link between R&D and future productivity, as predicted by endogenous growth models…