IDEAS home Printed from https://ideas.repec.org/a/ags/jrapmc/339967.html
   My bibliography  Save this article

The Impact of State Fiscal Policy on States’ Resilience During the Great Recession

Author

Listed:
  • Prescott, Peter
  • Gjerde, Kathy Paulson

Abstract

This study examines policies and conditions in the United States that impacted the length and depth of the Great Recession at the state level. In general, we found that the states’ fiscal-policy decisions leading up to the Great Recession had little or no effect on its duration, but that the relative magnitude and mix of fiscal policy instruments the states employed did affect that recession’s depth for each state. Furthermore, our results suggest that states can have a meaningful impact on recession length and depth by engaging in certain types of long-term structural planning. These findings help explain the states’ differing ability to navigate economic shocks, like the Great Recession, and that knowledge may aid state governments when they confront future recessionary events.

Suggested Citation

  • Prescott, Peter & Gjerde, Kathy Paulson, 2022. "The Impact of State Fiscal Policy on States’ Resilience During the Great Recession," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 52(1), January.
    • Handle: RePEc:ags:jrapmc:339967
    DOI: 10.22004/ag.econ.339967
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/339967/files/Prescott.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.339967?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Steven Brakman & Harry Garretsen & Charles van Marrewijk, 2015. "Regional resilience across Europe: on urbanisation and the initial impact of the Great Recession," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 8(2), pages 225-240.
    2. Tal Gross & Matthew J. Notowidigdo & Jialan Wang, 2020. "The Marginal Propensity to Consume over the Business Cycle," American Economic Journal: Macroeconomics, American Economic Association, vol. 12(2), pages 351-384, April.
    3. Niklas Potrafke, 2018. "Government ideology and economic policy-making in the United States—a survey," Public Choice, Springer, vol. 174(1), pages 145-207, January.
    4. Ron Martin, 2012. "Regional economic resilience, hysteresis and recessionary shocks," Journal of Economic Geography, Oxford University Press, vol. 12(1), pages 1-32, January.
    5. Bernard Fingleton & Harry Garretsen & Ron Martin, 2012. "Recessionary Shocks And Regional Employment: Evidence On The Resilience Of U.K. Regions," Journal of Regional Science, Wiley Blackwell, vol. 52(1), pages 109-133, February.
    6. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    7. Gjerde, Kathy Paulson & Prescott, Peter & Rice, Jennifer, 2019. "The Impact of State Fiscal Policy on States' Resilience Entering the Great Recession," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 49(1), January.
    8. Jonathan A. Parker & Nicholas S. Souleles & David S. Johnson & Robert McClelland, 2013. "Consumer Spending and the Economic Stimulus Payments of 2008," American Economic Review, American Economic Association, vol. 103(6), pages 2530-2553, October.
    9. Walden, Michael L., 2014. "Recovery from the Great Recession: Explaining Differences Among the States," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 44(2).
    10. Ron Martin & Peter Sunley, 2015. "On the notion of regional economic resilience: conceptualization and explanation," Journal of Economic Geography, Oxford University Press, vol. 15(1), pages 1-42.
    11. Azhar Iqbal & John Silvia, 2016. "Is Predicting Recessions Enough?," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 51(4), pages 248-259, October.
    12. Khatiwada, Lila K., 2014. "Modeling and Explaining County-level Prosperity in the U.S," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 44(2).
    13. John Connaughton & Ronald Madsen, 2009. "Regional implications of the 2001 recession," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(2), pages 491-507, June.
    14. Theodore M. Crone & Alan Clayton-Matthews, 2005. "Consistent Economic Indexes for the 50 States," The Review of Economics and Statistics, MIT Press, vol. 87(4), pages 593-603, November.
    15. Paul A. Lewin & Philip Watson & Anna Brown, 2018. "Surviving the Great Recession: the influence of income inequality in US urban counties," Regional Studies, Taylor & Francis Journals, vol. 52(6), pages 781-792, June.
    16. Ron Martin & Peter Sunley & Ben Gardiner & Peter Tyler, 2016. "How Regions React to Recessions: Resilience and the Role of Economic Structure," Regional Studies, Taylor & Francis Journals, vol. 50(4), pages 561-585, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wall, Howard, 2023. "The Great, Greater, and Greatest Recessions of US States," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 53(1), January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gjerde, Kathy Paulson & Prescott, Peter & Rice, Jennifer, 2019. "The Impact of State Fiscal Policy on States' Resilience Entering the Great Recession," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 49(1), January.
    2. Ugo Fratesi & Giovanni Perucca, 2018. "Territorial capital and the resilience of European regions," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 60(2), pages 241-264, March.
    3. Lisa Gianmoena & Vicente Rios, 2018. "The Determinants of Resilience in European Regions During the Great Recession: a Bayesian Model Averaging Approach," Discussion Papers 2018/235, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    4. Meiyue Li & Xiaowen Wang, 2022. "How Regions React to Economic Crisis: Regional Economic Resilience in a Chinese Perspective," SAGE Open, , vol. 12(4), pages 21582440221, December.
    5. Pedro Sánchez-Zamora & Rosa Gallardo-Cobos, 2019. "Diversity, Disparity and Territorial Resilience in the Context of the Economic Crisis: An Analysis of Rural Areas in Southern Spain," Sustainability, MDPI, vol. 11(6), pages 1-21, March.
    6. Giulio Cainelli & Roberto Ganau & Marco Modica, 2019. "Industrial relatedness and regional resilience in the European Union," Papers in Regional Science, Wiley Blackwell, vol. 98(2), pages 755-778, April.
    7. Wang, Xueli & Wang, Lei & Zhang, Xuerong & Fan, Fei, 2022. "The spatiotemporal evolution of COVID-19 in China and its impact on urban economic resilience," China Economic Review, Elsevier, vol. 74(C).
    8. Hundt Christian & Grün Lennart, 2022. "Resilience and specialization – How German regions weathered the Great Recession," ZFW – Advances in Economic Geography, De Gruyter, vol. 66(2), pages 96-110, July.
    9. Suat Tuysuz & Tüzin Baycan & Fatih Altuğ, 2022. "Economic impact of the COVID-19 outbreak in Turkey: analysis of vulnerability and resilience of regions and diversely affected economic sectors," Asia-Pacific Journal of Regional Science, Springer, vol. 6(3), pages 1133-1158, October.
    10. Elias Giannakis & Adriana Bruggeman, 2017. "Economic crisis and regional resilience: Evidence from Greece," Papers in Regional Science, Wiley Blackwell, vol. 96(3), pages 451-476, August.
    11. Xin Mai & Roger C. K. Chan, 2020. "Detecting the intellectual pathway of resilience thinking in urban and regional studies: A critical reflection on resilience literature," Growth and Change, Wiley Blackwell, vol. 51(3), pages 876-889, September.
    12. Martini, Barbara, 2020. "Resilience and economic structure. Are they related?," Structural Change and Economic Dynamics, Elsevier, vol. 54(C), pages 62-91.
    13. Luciana Lazzeretti & Stefania Oliva & Niccolò Innocenti, 2019. "Exploring the role of industrial structure for regional economic resilience," Papers in Evolutionary Economic Geography (PEEG) 1917, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised May 2019.
    14. Olena Khlystova & Yelena Kalyuzhnova, 2023. "The impact of the creative industries and digitalization on regional resilience and productive entrepreneurship," The Journal of Technology Transfer, Springer, vol. 48(5), pages 1654-1695, October.
    15. Giuseppe Terzo, 2021. "Social capital, social economy and economic resilience of Italian provinces," Papers in Regional Science, Wiley Blackwell, vol. 100(5), pages 1113-1135, October.
    16. Linus Holtermann & Christian Hundt, 2018. "Hierarchically structured determinants and phase related patterns of economic resilience. An empirical case study for European regions," Working Papers on Innovation and Space 2018-02, Philipps University Marburg, Department of Geography.
    17. Xin Mai & Roger C. K. Chan & Chaoqun Zhan, 2019. "Which Sectors Really Matter for a Resilient Chinese Economy? A Structural Decomposition Analysis," Sustainability, MDPI, vol. 11(22), pages 1-17, November.
    18. Philip Watson & Steven Deller, 2022. "Tourism and economic resilience," Tourism Economics, , vol. 28(5), pages 1193-1215, August.
    19. Liangang Li & Pingyu Zhang & Chengxin Wang, 2022. "What Affects the Economic Resilience of China’s Yellow River Basin Amid Economic Crisis—From the Perspective of Spatial Heterogeneity," IJERPH, MDPI, vol. 19(15), pages 1-20, July.
    20. Filippo Di Pietro & Patrizio Lecca & Simone Salotti, 2021. "Regional economic resilience in the European Union: a numerical general equilibrium analysis," Spatial Economic Analysis, Taylor & Francis Journals, vol. 16(3), pages 287-312, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:jrapmc:339967. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/mcrsaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.