Recessions, Recoveries and Regional Resilience: an econometric perspective

Three chapters constitute the main structure of this contribution. Chapter I reviews selected theoretical and empirical approaches dealing with regional evolution in order to identify recent developments and extensions incorporating spatial econometrics techniques. Chapter II investigates transient and permanent asymmetric effects of national-wide recessions across Italian regions during the last thirty years, by proposing the recent resilience framework as an helpful synthesis. Chapter III studies the determinants of the uneven cross-regional behaviour during crises and recoveries, by presenting two complementary econometric models, namely a linear vector error correction (VECM) model and a non-linear smooth-transition autoregressive (STAR) specification. Some of the main results here obtained are: regions within the same country differ in terms of both shock-absorption and post-recession pattern; the broad impact of a common shock shall take into account temporary and persistent effects; differences in recessions and recoveries among areas can be motivated by some elements such as industrial structure, export propensity, human and civic capital, and financial constraints. Moreover, the presence of spatial interdependencies and neighbouring interactions can play a relevant role. Moving from some of the results here presented, the desirable next step should be addressed towards a deeper analysis of the determinants of regional heterogeneity during recessions and recoveries, cross-country comparisons, the development of a more structured theoretical and empirical background, the assessment of the place-specific impact of countercyclical policies. These and other questions are left for future research.