The road to economic recovery: Pandemics and innovation
Wang, Lipeng Zhang, Mengyu Verousis, Thanos
Wang, Lipeng
Zhang, Mengyu
Verousis, Thanos
Citations
Altmetric:
Publication Type
Journal article with impact factor
Editor
Supervisor
Publication Year
2021
Journal
International Review of Financial Analysis
Book
Publication Volume
75
Publication Issue
May
Publication Begin page
Publication End page
Publication NUmber of pages
Collections
Abstract
In this paper, we investigate the economic consequences of pandemics from an idea-based theory of economic growth. We assume that pandemics pose a threat to research productivity and analyse the long-term consequences of pandemic shocks to innovation output. We demonstrate that following a pandemic, innovation output is disrupted for approximately seven years. The effect of pandemic shocks on innovation output varies between countries, and sector to sector regarding economic activity. Pandemic shocks lead to a short-term drop in the number of patent applications. Crucially, the duration of a pandemic has a strong effect on innovation output. Overall, the effects of this most recent pandemic on future innovation output, and subsequently on growth, are expected to be felt long into the future. This paper supports the policies designed to reduce the effect of the “Great Lockdown” on research productivity. Policies that target the more innovative firms are moving in the right direction in terms of reducing the time it will take for innovation to recover from the effects of COVID19.
Research Projects
Organizational Units
Journal Issue
Keywords
Innovation, Pandemic, Local Projection, COVID-19