{
  "title": "Did R&D Misallocation Contribute to Slower Growth?",
  "publication": "IMF Working Papers, September 12, 2025",
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  "summary": "This paper provides evidence that rising misallocation in the R&D sector contributed to the recent slowdown in U.S. productivity growth.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- The paper provides evidence that rising misallocation in the R&D sector contributed to the recent slowdown in U.S. productivity growth.\n- Develops a growth accounting framework that allows for misallocation of R&D resources across firms, captured by wedges between their marginal cost and benefits of R&D.\n- Shows that R&D wedges can be measured from R&D returns and documents large and persistent differences in R&D returns across US-listed firms.\n- Combining data and model, estimates that frictions reduced productivity growth by 18% over 1975–2014 and that rising misallocation in the R&D sector accounts for 25% of the growth slowdown."
    },
    {
      "heading": "Methodology",
      "content": "- Growth accounting framework incorporating firm-level R&D resource misallocation.\n- Misallocation captured as wedges between firms’ marginal cost and marginal benefit of R&D.\n- Measurement approach: infer R&D wedges from observed R&D returns across firms.\n- Empirical focus on US-listed firms to document dispersion and persistence of R&D returns."
    },
    {
      "heading": "Key findings and estimates",
      "content": "- Frictions reduced productivity growth by 18% over 1975–2014.\n- Rising misallocation in the R&D sector accounts for 25% of the productivity growth slowdown.\n- Large and persistent differences in R&D returns across US-listed firms are documented (no additional numeric dispersion metrics provided on the landing page)."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects: Expenditure, Labor, Labor markets, Production, Productivity, Total factor productivity\n- Keywords: growth accounting framework, growth slowdown, Labor markets, Productivity, productivity growth, R&D, R&D misallocation, R&D resource, R&D return dispersion, R&D wedge, Total factor productivity\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2025/09/12/did-r-d-misallocation-contribute-to-slower-growth-570339"
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    "Authors: Nils H. Lehr",
    "Published: September 12, 2025",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229025379.001",
    "The paper provides evidence that rising misallocation in the R&D sector contributed to the recent slowdown in U.S. productivity growth.",
    "Develops a growth accounting framework that allows for misallocation of R&D resources across firms, captured by wedges between their marginal cost and benefits of R&D.",
    "Shows that R&D wedges can be measured from R&D returns and documents large and persistent differences in R&D returns across US-listed firms.",
    "Combining data and model, estimates that frictions reduced productivity growth by 18% over 1975–2014 and that rising misallocation in the R&D sector accounts for 25% of the growth slowdown.",
    "Growth accounting framework incorporating firm-level R&D resource misallocation.",
    "Misallocation captured as wedges between firms’ marginal cost and marginal benefit of R&D.",
    "Measurement approach: infer R&D wedges from observed R&D returns across firms.",
    "Empirical focus on US-listed firms to document dispersion and persistence of R&D returns.",
    "Frictions reduced productivity growth by 18% over 1975–2014.",
    "Rising misallocation in the R&D sector accounts for 25% of the productivity growth slowdown.",
    "Large and persistent differences in R&D returns across US-listed firms are documented (no additional numeric dispersion metrics provided on the landing page).",
    "Subjects: Expenditure, Labor, Labor markets, Production, Productivity, Total factor productivity",
    "Keywords: growth accounting framework, growth slowdown, Labor markets, Productivity, productivity growth, R&D, R&D misallocation, R&D resource, R&D return dispersion, R&D wedge, Total factor productivity",
    "**Working Paper**"
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