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Impact of business cycles on value added and employment growth by industrial classification Note: EU KLEMS data; WIFO calculations; Dark bars: impact on value added growth; light bars: impact on employment growth
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This paper studies the business cycle sensitivity of industries using different industry groupings. The results show that technologically intense industries are heavily affected by business cycles. While the overall importance of business cycles for long-run growth seems to be rather limited, we observe for industries with high technology intensity...
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... More specifically, in the current age of restructuring of globalization, where the "tectonic plates" of capitalism are transforming gradually, the dynamics of entrepreneurship and innovation seem to play a vital role in regional development and underdevelopment (Laudicina and Peterson, 2016;Wei, 2015). Of course, the regions, like business ecosystems, include cross-industrial phenomena in the sense that do not host a single industry but contain relations, competitions, challenges, and synergies from different globalized sectors, regardless of their size or technological potential (Hölzl et al., 2015). ...
This article aims to highlight the different facets of the relative socio-economic underdevelopment of the Greek region of Eastern Macedonia and Thrace. It explores initially regional analysis data, leading to the conclusion that the region does indeed face comparative weaknesses as it exhibits multiplier results and specialization in areas with the lowest value-added and employment. It then presents the main conclusions about small and micro firms of this less developed business ecosystem. It concludes that the region has structural competitiveness problems that are primarily due to the competitiveness of the firms that can host and nurture. The strengthening of competitiveness of this regional business ecosystem requires the improvement of the innovative potential that, in a triple helix condition, is the result of the evolutionary interconnection between local-regional firms, government, and academia. To this end, the proposal to establish a Local Development and Innovation Institute constitutes a new regional policy that can be applied to the region and strengthen the innovative potential of the entire regional business ecosystem.
... For the polar scenarios, the strongest steady growth and steady decline take place. Empirical studies of the impact of business cycles on value added and employment growth in different industries typically find that the producers of capital and intermediate goods experience largest fluctuations, followed by the producers of consumption goods and utilities (Hölzl et al. 2015). This is consistent with the observation that private consumption is the largest and the most stable component on the expenditure side of national accounts, and investment is one of the most volatile. ...
Business tendency surveys are widely used for monitoring economic activity. They provide timely feedback on the current business conditions and outlook. We identify the unobserved macroeconomic factors behind the distribution of quarterly responses by Austrian firms on the questions concerning the current business climate and production. The aggregate models identify two macroeconomic regimes: upturn and downturn. Their dynamics is modeled using a regime-switching matrix. The micro-founded models envision dependent responses by the firms, so that a favorable or an adverse unobserved common macroeconomic factor increases the frequency of optimistic or pessimistic responses. The corresponding conditional transition probabilities are estimated using a coupling scheme. Extensions address the sector dimension and introduce dynamic common tendencies modeled with a hidden Markov chain.
... Die Herstellung von Waren reagiert unter den Sektoren auf der Entstehungsseite des BIP neben der Bauwirtschaft am stärksten auf Konjunkturschwankungen (Hölzl Kaniovski Reinstaller, 2015). Sie ist zudem eng mit internationalen Wertschöpfungsketten verflochten. ...
Seit Juni 2018 unterstützt ein dynamisches Faktormodell die WIFO-Prognose der Wertschöpfung der Sachgüterproduktion (Herstellung von Waren) und der Ausrüstungsinvestitionen. Wie eine Überprüfung seiner Prognoseeigenschaften zeigt, hat es einen hohen Vorlauf und kann daher einen wichtigen Input zur Expertenprognose leisten.
... The reaction to the output gap in the third panel of Figure II-7-5 shows the strongest impact for the low knowledge-intensive market services followed by the manufacturing industries (except low-technology manufacturing) that are generally considered to be more sensitive to business cycle influences than service industries (e.g., Hölzl, Kaniovski, Reinstaller, 2015). This is likely related to the fact that the economic downturn in many of the countries also led to a substantial decline in consumption that affected domestic oriented low-knowledge-intensive market services more severely than during normal business cycle downturns, where consumption remains relatively smooth compared to other economic aggregates. ...
Despite the technology sector being highly responsive to market fluctuations, individual instances of its lower sensitivity to high market volatility and crisis are documented. This paper analyzes the dependence between the stock market volatility and technology on the U.S. market using the copula modeling approach. Results indicate that The dependence between market volatility and returns of the technology stocks is strongly negative and asymmetrically increasing with surges in market volatility, signaling a presence of negative lower tail. The 270°rotated Gumbel copula is chosen as the best fitting model. The observed dependence is in line with stylized facts for financial returns.
