Sectoral–regional resilience and productive specialization: a comparison among the last three crises

Abstract

AbstractThe objective of this paper is to compare the economic resilience of industries and regions along the last four decades, which include the three last major crises for the advanced countries (90s, Great Recession in 2007 and recent COVID-19 pandemic). Productive structure and sectoral specialization are introduced as explaining factor for the different regional behaviors. For this purpose, we estimate both resilience and specialization indices based on employment data. To analyze the relationship between specialization and resilience, a cross-sectional descriptive analysis is complemented by a panel data model that includes some controls. Finally, a regional shift-share analysis contributes to exert some other regional effects affecting economic resilience. The results of this research show some continuities and other significant changes in the regional impact of crises from one to the next. Although there are other effects to have played a role, results show economic specialization is found to have exerted influence on the recovery of certain regions during this period. Recovery periods differ from each crisis and the results might be affected for this dimensionality limitation. Due to the characteristics of the database, the study includes only six sectors. However, general results are generalizable to other regions as the response of employment growth to crises is similar in many advanced regions and specialization patterns does not significantly differ among regions. The paper carries a structural long-term comparison between the last major crises for Spanish regions, which clearly differentiates one from another in their causes and effects. We introduce specialization to explain the different regional resilience patterns. Methodologically, we estimate both sectoral and regional resilience indices for these three crises and relate this resilience to specialization and other explaining factors.