IDEAS home Printed from https://ideas.repec.org/a/spr/anresc/v70y2023i1d10.1007_s00168-022-01134-w.html
   My bibliography  Save this article

How regional economic structure matters in the era of COVID-19: resilience capacity of U.S. states

Author

Listed:
  • Ayoung Kim

    (Mississippi State University)

  • Jaewon Lim

    (University of Nevada Las Vegas)

  • Aaron Colletta

    (University of Nevada Las Vegas)

Abstract

The COVID-19 pandemic is an unexpected-extreme event and has considerably impacted the national and regional economies. This paper emphasizes the importance of industrial structure for a region’s resistance to the recessionary shock. Two significant factors that may determine the regional industrial structures in this ongoing recession include the relative composition of essential/non-essential sectors and the intensity of face-to-face interactions. Considering these factors, we focus on two groups of industries: essential industry with low interpersonal interactions and non-essential industry with high interpersonal interactions. The specialization in these industries is associated with the regional economic resistance to the COVID-19 induced recession. Estimation results from the ordinal logistic regression models show that essential industries with low interpersonal interactions, especially the retail and service sectors––for instance, non-store retailers and financial and professional service––are significantly related to regional economic resistance, and their relationship intensifies compared to other sectors during the COVID-19 pandemic. However, states specialized in the non-essential industries with high interpersonal interactions are less likely to resist economically during the lockdown-COVID and until the stabilizing-COVID period. In addition, a state that quickly recovered from the 2001 recession is more likely to resist the pandemic shock during early- and lockdown-COVID periods. Findings in this paper indicate the importance of regional industrial structure to determine the level of vulnerability to unexpected recessionary shocks. Additionally, identifying the vital factors to determine the industrial structure based on the type of shock is found to be crucial.

Suggested Citation

  • Ayoung Kim & Jaewon Lim & Aaron Colletta, 2023. "How regional economic structure matters in the era of COVID-19: resilience capacity of U.S. states," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 70(1), pages 159-185, February.
    • Handle: RePEc:spr:anresc:v:70:y:2023:i:1:d:10.1007_s00168-022-01134-w
    DOI: 10.1007/s00168-022-01134-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00168-022-01134-w
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00168-022-01134-w?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Riccardo Crescenzi & Davide Luca & Simona Milio, 2016. "Editor's choice The geography of the economic crisis in Europe: national macroeconomic conditions, regional structural factors and short-term economic performance," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 9(1), pages 13-32.
    2. Ron Martin, 2012. "Regional economic resilience, hysteresis and recessionary shocks," Journal of Economic Geography, Oxford University Press, vol. 12(1), pages 1-32, January.
    3. Gilles Duranton & Diego Puga, 2000. "Diversity and Specialisation in Cities: Why, Where and When Does it Matter?," Urban Studies, Urban Studies Journal Limited, vol. 37(3), pages 533-555, March.
    4. Raffaele Lagravinese, 2015. "Economic crisis and rising gaps North–South: evidence from the Italian regions," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 8(2), pages 331-342.
    5. James Simmie & Ron Martin, 2009. "The economic resilience of regions: towards an evolutionary approach," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 3(1), pages 27-43.
    6. Crescenzi, Riccardo & Luca, Davide & Milio, Simona, 2016. "The geography of the economic crisis in Europe: national macroeconomic conditions, regional structural factors and short-term economic performance," LSE Research Online Documents on Economics 64061, London School of Economics and Political Science, LSE Library.
    7. 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.
    8. 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.
    9. Justin Doran & Bernard Fingleton, 2016. "Employment Resilience in Europe and the 2008 Economic Crisis: Insights from Micro-Level Data," Regional Studies, Taylor & Francis Journals, vol. 50(4), pages 644-656, April.
    10. Melo, Patricia C. & Graham, Daniel J. & Noland, Robert B., 2009. "A meta-analysis of estimates of urban agglomeration economies," Regional Science and Urban Economics, Elsevier, vol. 39(3), pages 332-342, May.
    11. 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.
    12. Alessandra Faggian & Roberta Gemmiti & Timothy Jaquet & Isabella Santini, 2018. "Regional economic resilience: the experience of the Italian local labor systems," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 60(2), pages 393-410, March.
    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. Robert Calvert Jump & Adam Scavette, 2024. "Do Research Universities Recession Proof Their Regions? Evidence from State Flagship College Towns," Working Paper 24-05, Federal Reserve Bank of Richmond.

    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. 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.
    2. 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.
    3. Adelheid Holl, 2018. "Local employment growth patterns and the Great Recession: The case of Spain," Journal of Regional Science, Wiley Blackwell, vol. 58(4), pages 837-863, September.
    4. 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.
    5. 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.
    6. Silvia Rocchetta & Andrea Mina & Changjun Lee & Dieter F Kogler, 2022. "Technological knowledge spaces and the resilience of European regions," Journal of Economic Geography, Oxford University Press, vol. 22(1), pages 27-51.
    7. Hasan Engin Duran & Ugo Fratesi, 2023. "Economic resilience and regionally differentiated cycles: Evidence from a turning point approach in Italy," Papers in Regional Science, Wiley Blackwell, vol. 102(2), pages 219-252, April.
    8. 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.
    9. Fabio Mazzola & Iolanda Cascio & Rosalia Epifanio & Giuseppe Giacomo, 2018. "Territorial capital and growth over the Great Recession: a local analysis for Italy," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 60(2), pages 411-441, March.
    10. 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.
    11. Pietro Pizzuto, 2020. "The role of regional competitiveness in shaping the heterogeneous impact of the Great Recession," Regional Science Policy & Practice, Wiley Blackwell, vol. 12(2), pages 267-290, April.
    12. Giulia Urso & Marco Modica & Alessandra Faggian, 2019. "Resilience and Sectoral Composition Change of Italian Inner Areas in Response to the Great Recession," Sustainability, MDPI, vol. 11(9), pages 1-15, May.
    13. Pontarollo, Nicola & Serpieri, Carolina, 2020. "A composite policy tool to measure territorial resilience capacity," Socio-Economic Planning Sciences, Elsevier, vol. 70(C).
    14. Jan Ženka & Marcela Chreneková & Lucie Kokešová & Veronika Svetlíková, 2021. "Industrial Structure and Economic Resilience of Non-Metropolitan Regions: An Empirical Base for the Smart Specialization Policies," Land, MDPI, vol. 10(12), pages 1-21, December.
    15. 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.
    16. Mastronardi, Luigi & Giagnacovo, Maria & Romagnoli, Luca, 2020. "Bridging regional gaps: Community-based cooperatives as a tool for Italian inner areas resilience," Land Use Policy, Elsevier, vol. 99(C).
    17. Barbara MARTINI, 2020. "Resilience, Resistance And Recoverability, Regional Economic Structure And Human Capital In Italy. Are They Related?," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 20(1), pages 47-62.
    18. 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.
    19. Mathieu P A Steijn & Pierre-Alexandre Balland & Ron Boschma & David L Rigby, 2023. "Technological diversification of U.S. cities during the great historical crises," Journal of Economic Geography, Oxford University Press, vol. 23(6), pages 1303-1344.
    20. Vinko Muštra & Blanka Škrabić Perić & Smiljana Pivčević, 2023. "Cultural heritage sites, tourism and regional economic resilience," Papers in Regional Science, Wiley Blackwell, vol. 102(3), pages 465-482, June.

    More about this item

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L8 - Industrial Organization - - Industry Studies: Services

    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:spr:anresc:v:70:y:2023:i:1:d:10.1007_s00168-022-01134-w. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.