I show that firms at different stages of the product life cycle respond differently to increases in economic uncertainty, and that this heterogeneity matters for understanding the aggregate implications of uncertainty for the economy. In response to higher uncertainty, early-stage firms increase investment, leading to greater innovation output (e.g., product patents). In contrast, late-stage firms reduce both investment and innovation. Using highly granular product-level data, I find that when uncertainty rises, early-stage firms increase product entry and exit, shifting their portfolios toward newer products, whereas late-stage firms scale back portfolio adjustments by reducing entry and exit activity.
Comissão Organizadora
Comissão Científica
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