The full implications of the global financial crisis of 2008–2009 are yet to be revealed. The crucial question is whether a crisis of such severe magnitude will set “cleansing mechanisms” into motion as suggested by the opportunity cost argument of R&D, or rather destroy the long-term productivity enhancing incentives? The World Bank Financial Crisis Survey collects direct self-reported measures of firms’ credit frictions and R&D during 2009–2010 from six countries: Bulgaria, Latvia, Lithuania, Hungary, Romania and Turkey. Employing this dataset, we seek evidence of how the firms’ R&D responded to the demand and credit contraction at the time of the crisis. Looking at two distinct episodes, the sustained economic growth in 2001–2007 and the sudden slump in 2009–2010, we observe a paradigm shift in firms’ R&D decisions: whilst the R&D is counter-cyclical during the pre-crisis period, a pro-cyclical pattern emerges in response to the crisis.