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Measuring urban economic resilience of two tropical cities, using impulse response analysis

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Listed:
  • Taha Chaiechi
  • Trang Nguyen

Abstract

The global urbanisation rate had increased rapidly from just 30% in 1950 to 55% in 2018, and it is projected to reach 68% by 2050. This ongoing urbanisation shows the importance of building resilient economies in dealing with complex external financial and public health shocks and disturbances. Although most growing cities are beginning to demonstrate dedication to integrating sustainable development goals, building economic resilience in cities remains a significant challenge. During the past crises, stronger economies have shown an apparent ability to recover from shocks relatively quickly. Nonetheless, the severe COVID-19 recession has unmasked superficial evidence of economic resilience while also identifying underlying vulnerabilities and economic weak-spots. Accordingly, this paper focuses on resilience as a non-equilibrium property of urban economic structures. Focusing on two tropical cities, the paper explores sources of volatility transmission as indicators of urbanisation change, by utilising orthogonal impulse- response (OIR) functions based upon the Cholesky decomposition. The findings suggest a metropolitan disadvantage concerning urban economic resilience predominantly from shocks on sources of urbanisation.

Suggested Citation

  • Taha Chaiechi & Trang Nguyen, 2021. "Measuring urban economic resilience of two tropical cities, using impulse response analysis," Bulletin of Applied Economics, Risk Market Journals, vol. 8(1), pages 59-79.
    • Handle: RePEc:rmk:rmkbae:v:8:y:2021:i:1:p:59-79
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    References listed on IDEAS

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    1. Ellen M Hoffmann & Verena Konerding & Sunil Nautiyal & Andreas Buerkert, 2019. "Is the push-pull paradigm useful to explain rural-urban migration? A case study in Uttarakhand, India," PLOS ONE, Public Library of Science, vol. 14(4), pages 1-22, April.
    2. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-1580, November.
    3. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
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    Cited by:

    1. Michael Koczyrkewycz & Taha Chaiechi & Rabiul Beg, 2021. "Productivity Growth Recovery Mechanisms: An ARDL Approach Lessons from the United States, Japan and South Korea," Bulletin of Applied Economics, Risk Market Journals, vol. 8(2), pages 163-184.

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    More about this item

    Keywords

    economic resilience; urban economics; urbanisation; tropical cities; impulse response analysis;
    All these keywords.

    JEL classification:

    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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