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Sailing in all winds: Technological search over the business cycle

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  • Silvestri, Daniela
  • Riccaboni, Massimo
  • Della Malva, Antonio

Abstract

Business cycles modify firms’ incentives to innovate and the direction of innovation. By introducing a new measure of patent unconventionality this paper explores the impact of the business cycle on firms’ technological search strategies. We find that during upturns firms generate inventions characterized by a higher level of technological unconventionality. We also find that financially resilient and diversified firms produce more unconventional patents. While patent unconventionality is associated with technological impact and market value, firms extract more value by investing in unconventional inventions in downturns.

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  • Silvestri, Daniela & Riccaboni, Massimo & Della Malva, Antonio, 2018. "Sailing in all winds: Technological search over the business cycle," Research Policy, Elsevier, vol. 47(10), pages 1933-1944.
    • Handle: RePEc:eee:respol:v:47:y:2018:i:10:p:1933-1944
    DOI: 10.1016/j.respol.2018.07.002
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    4. Yuan Gao & Emiliya Lazarova, 2022. "A New Empirical Index to Track the Technological Novelty of Inventions: A Sector Level Analysis," University of East Anglia School of Economics Working Paper Series 2022-08, School of Economics, University of East Anglia, Norwich, UK..
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    More about this item

    Keywords

    Innovation; Technological change; Business cycle; Patent indicators;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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