During recessions, increased spending on research and development and on advertising can benefit certain types of firms and punish others, according to researchers, who identified the firm types that spend most effectively.
More than 10,000 firm-years of data from publicly listed U.S. firms from 1969 to 2008 -- a period that included seven recessions -- were examined by Gary L. Lilien, Distinguished Research Professor of Management Science, Penn State Smeal College of Business; Raji Srinivasan, University of Texas; and Shrihari Sridhar, Michigan State University.