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Technology and contractions: evidence from manufacturing

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  • Samaniego, Roberto M.
  • Sun, Juliana Y.

Abstract

Theory suggests a range of technological characteristics that might interact with the business cycle depending on what kind of shocks or propagation mechanisms are quantitatively important. We use variation in industry growth within manufacturing to determine which technological characteristics interact significantly with the business cycle. We find that growth in labor intensive industries is especially sensitive to contractions. We show this cross-industry asymmetry occurs specifically in contractions, not in recoveries nor over the cycle in general.

Suggested Citation

  • Samaniego, Roberto M. & Sun, Juliana Y., 2015. "Technology and contractions: evidence from manufacturing," European Economic Review, Elsevier, vol. 79(C), pages 172-195.
    • Handle: RePEc:eee:eecrev:v:79:y:2015:i:c:p:172-195
    DOI: 10.1016/j.euroecorev.2015.07.006
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    5. Neto, António & Furukawa, Yuichi & Ribeiro, Ana Paula, 2017. "Can Trade Unions Increase Social Welfare? An R&D Model with Cash-in-Advance Constraints," MPRA Paper 77312, University Library of Munich, Germany.
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    7. Lee, Dongwon, 2023. "Commodity terms of trade volatility and industry growth," European Economic Review, Elsevier, vol. 156(C).
    8. Sangyup Choi & Davide Furceri & Prakash Loungani, 2019. "Inflation Anchoring, Real Borrowing Costs, and Growth: Evidence from Sectoral Data," Working papers 2019rwp-143, Yonsei University, Yonsei Economics Research Institute.
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    More about this item

    Keywords

    Technology; Business cycle; Financing constraints; Inalienability of human capital; Financial development;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy

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