Trade and the geographic spread of the great recession

Sebastian Stumpner

Journal of International Economics, 2019, vol. 119, issue C, 169-180

Abstract: I study the role of trade between U.S. states in the regional propagation of local consumer demand shocks during the Great Recession. To identify the trade channel empirically, I make use of heterogeneity in the direction of trade flows across industries in the same state: Industries that depended relatively more on final demand from states with housing boom-bust cycles grew by more before the crisis and declined faster from 2007 to 09. A one standard deviation difference in the exposure to demand shocks during the recession explains a 2.9 percentage point difference in employment growth.

Keywords: Interregional trade; Regional propagation; Great recession (search for similar items in EconPapers)
JEL-codes: F14 F16 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Trade and the Geographic Spread of the Great Recession (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:119:y:2019:i:c:p:169-180

DOI: 10.1016/j.jinteco.2019.04.001

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