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The Composition of Industry and the Duration of State Recessions

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  • Kuhlmann, Angela
  • Decker, Christopher S.
  • Wohar, Mark E.

Abstract

In this paper, we investigate the determinants of the duration of state level recessions in the United States that occurred over the period 1979 to 1997. Contrary to much of the existing related literature, we find that a significant factor that influences the duration of state reces-sions is whether a state’s degree of industrial diversity is increasing or decreasing. Specifically, we find that states that are becoming more diverse have recessions of shorter duration. In states where diversity is decreasing, recessions are longer in duration. This finding, we be-lieve, is a hopeful message for states that are relatively more concentrated since it seems to in-dicate that their initial level of diversity is not as important as their change in diversity. There-fore, this could mean that as long as a state can accelerate its industrial diversification, they may be able to reduce the duration of their recessions.

Suggested Citation

  • Kuhlmann, Angela & Decker, Christopher S. & Wohar, Mark E., 2008. "The Composition of Industry and the Duration of State Recessions," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 38(3), pages 1-16.
  • Handle: RePEc:ags:jrapmc:132999
    DOI: 10.22004/ag.econ.132999
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    References listed on IDEAS

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    Cited by:

    1. Barth, James R. & Benefield, Justin D. & Hollans, Harris, 2015. "Industry Concentration and Regional Housing Market Performance," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 45(2).
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    3. Salisu, Afees A. & Adekunle, Wasiu & Alimi, Wasiu A. & Emmanuel, Zachariah, 2019. "Predicting exchange rate with commodity prices: New evidence from Westerlund and Narayan (2015) estimator with structural breaks and asymmetries," Resources Policy, Elsevier, vol. 62(C), pages 33-56.

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