Resilience in the Face of Chronic Distress: U.S. Metropolitan Areas After the Great Recession

Abstract

This study explores the causal drivers of regional economic decline in the aftermath of dramatic national economic shocks. Extant research on regional decline illustrates the difference between cyclical and structural decline, but such examination predates the “Great Recession” spanning from late 2007 to 2009. The paper consists of two sections. First, a descriptive analysis of the event is conducted, focusing specifically on geographic patterns of decline and recovery. Second, an empirical model is employed to identify the factors associated with decline, recovery, and new equilibria following the Great Recession. Our findings indicate mixed results. On one hand, regional industry composition is an important predictor of resilience, specifically when regions entered the recession with a diversity of export industries. On the other hand, location-specific factors—such as educational attainment and the age of the principal city—played a nontrivial role in predicting whether a regional economy would be able to survive the recession.

Date
May 21, 2018
Event
Atlanta Federal Reserve Bank & Upjohn Institute Research Workshop
Location
Atlanta, GA