Monetary policy impacts innovation, says research
Paper presented at Jackson Hole conference finds tighter policy can cut long-term growth
Monetary policy tightening decreases innovation, research presented at the Federal Reserve’s conference in Jackson Hole finds.
The paper adds to a growing body of research that finds monetary policy can have long-lasting impacts, rather than being neutral in the long term. “Monetary policy could have a persistent influence on the productive capacity of the economy,” say authors Yueran Ma and Kaspar Zimmermann.
A 100 basis point policy tightening decreases research and development spending by
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