How do regional economies respond to crises? The geography of job creation and destruction in Sweden (1990-2010)

Rikard H. Eriksson and Emelie Hane-Weijman

No 1511, Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography

Abstract: By means of Swedish longitudinal micro-data, the aim of this paper is to analyse how regional economies respond to crises. This is made possible by linking gross employment flows to the notion of regional resilience. Our findings indicate that despite a steady national employment growth, only the three metropolitan regions show higher employment figures than before the recession of 1990. Further, we can show evidence of high levels of job creation and destruction in both declining and expanding regions and sectors, and that the creation of jobs is mainly attributable to employment growth in incumbent firms while job destruction is primarily due to exits and micro-plants. Although the geography of resistance to crises and the ability of adaptability in the aftermath vary, our findings suggest that cohesive (i.e., with many skill-related industries) and diverse (i.e., with a high degree of unrelated variety) regions are more resilient over time. We also find that resistance to future shocks (e.g., the 2008 recession) is highly dependent on the resistance to previous crises. In all, this suggests that the long-term evolution of regional economies also influences their future resilience.

Keywords: regional economic evolution; job creation; job destruction; crises; regional resilience (search for similar items in EconPapers)
Date: 2015-05, Revised 2015-05
New Economics Papers: this item is included in nep-ent, nep-geo and nep-ure
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Citations: View citations in EconPapers (4)

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