Regional employment during recessions and recoveries in Japan: A data-driven approach

Yusuke Adachi, Hikaru Ogawa and Masafumi Tsubuku

Journal of Asian Economics, 2025, vol. 98, issue C

Abstract: This study investigates the impact of economic shocks on regional employment in Japan using causal forest algorithms and compares the data-driven findings with estimates derived from standard ordinary least squares (OLS) regression. Our results reveal no significant difference in the magnitude of impact between small and large regions. Instead, regional differences in impact stem from variations in pre-crisis employment growth and the concentration of local employment. Specifically, regions with a high proportion of manufacturing jobs demonstrate resilience to recession-related job losses but recover slowly, while regions with pre-crisis employment growth exceeding 5% suffer steep declines during recessions but exhibit strong recoveries.

Keywords: Economic shocks; Employment; Region; Industry and causal forests (search for similar items in EconPapers)
JEL-codes: C53 E24 R12 R23 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:98:y:2025:i:c:s1049007825000417

DOI: 10.1016/j.asieco.2025.101917

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