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The crisis sensitivity of European countries and regions: stylized facts and spatial heterogeneity

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  • Stefan P. T. Groot
  • J. L. Möhlmann
  • J. H. Garretsen
  • Henri L. F. de Groot

Abstract

We investigate the impact of the recent global recession on European countries and regions. We first identify the heterogeneous impact of the global recession on individual European countries and regions. We then discuss three classes of explanations for spatial heterogeneity in the severity of the crisis: (i) the extent to which countries are integrated in the global economy via financial and trade linkages, (ii) differences in the institutional framework of countries and (iii) differences in their sectoral composition. We show that especially variation in the sectoral composition contributes to the variation in the effects of the current crisis, both at the country level and at the detailed regional level across Europe. Copyright 2011, Oxford University Press.

Suggested Citation

  • Stefan P. T. Groot & J. L. Möhlmann & J. H. Garretsen & Henri L. F. de Groot, 2011. "The crisis sensitivity of European countries and regions: stylized facts and spatial heterogeneity," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 4(3), pages 437-456.
  • Handle: RePEc:oup:cjrecs:v:4:y:2011:i:3:p:437-456
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    File URL: http://hdl.handle.net/10.1093/cjres/rsr024
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    References listed on IDEAS

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    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "The Aftermath of Financial Crises," American Economic Review, American Economic Association, pages 466-472.
    2. Rose, Andrew K. & Spiegel, Mark M., 2011. "Cross-country causes and consequences of the crisis: An update," European Economic Review, Elsevier, vol. 55(3), pages 309-324, April.
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    7. Philip R Lane & Gian Maria Milesi-Ferretti, 2011. "The Cross-Country Incidence of the Global Crisis," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 59(1), pages 77-110, April.
    8. Sharpe, Steven A, 1994. "Financial Market Imperfections, Firm Leverage, and the Cyclicality of Employment," American Economic Review, American Economic Association, pages 1060-1074.
    9. Valerie Cerra & Sweta Chaman Saxena, 2008. "Growth Dynamics: The Myth of Economic Recovery," American Economic Review, American Economic Association, pages 439-457.
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    Cited by:

    1. Roberto Cellini & Paolo Di Caro & Gianpiero Torrisi, 2017. "Regional resilience in Italy: do employment and income tell the same story?," Chapters,in: Handbook of Regions and Competitiveness, chapter 14, pages 308-331 Edward Elgar Publishing.
    2. Di Caro, Paolo, 2014. "Recessions, recoveries and regional resilience: Evidence on Italy," MPRA Paper 60297, University Library of Munich, Germany.
    3. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "The Aftermath of Financial Crises," American Economic Review, American Economic Association, pages 466-472.
    4. Yannis PSYCHARIS & Antonis ROVOLIS & Vassilis TSELIOS & Panayotis PANTAZIS, 2014. "Economic Crisis And Regional Development In Greece," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, pages 67-85.
    5. Angela Parenti & Cristina Tealdi, 2017. "Does the abolition of border controls boost cross-border commuting? Evidence from Switzerland," Discussion Papers 2017/213, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    6. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "The Aftermath of Financial Crises," American Economic Review, American Economic Association, pages 466-472.
    7. Steven Brakman & Harry Garretsen & Charles van Marrewijk, 2014. "The Crisis and Regional Resilience in Europe: On the Importance of Urbanization and Specialization," CESifo Working Paper Series 4724, CESifo Group Munich.
    8. Jing Xiao & Ron Boschma & Martin Andersson, 2016. "Resilience in the European Union: the effect of the 2008 crisis on the ability of regions in Europe to develop new industrial specializations," Papers in Evolutionary Economic Geography (PEEG) 1608, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Apr 2016.
    9. Crescenzi, Riccardo & Luca, Davide & Milio, Simona, 2016. "The geography of the economic crisis in Europe: national macroeconomic conditions, regional structural factors and short-term economic performance," LSE Research Online Documents on Economics 64061, London School of Economics and Political Science, LSE Library.
    10. Nadia Garbellini & Enrico Marelli & Ariel Luis Wirkierman, 2014. "Domestic demand and global production in the Eurozone: A multi-regional input-output assessment of the global crisis," International Review of Applied Economics, Taylor & Francis Journals, pages 336-364.
    11. Rafik Abdesselam & Jean Bonnet & Patricia Renou-Maissant & Mathilde Aubry, 2014. "What happened to entrepreneurial economies after the financial crisis? An empirical study of OECD countries," Economics Working Paper Archive (University of Rennes 1 & University of Caen) 201416, Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS.
    12. Beata Bal Domańska, 2016. "The Impact of Economic Crisis on Convergence Processes in European Union Regions," Prague Economic Papers, University of Economics, Prague, pages 509-526.
    13. Cellini, Roberto & Cuccia, Tiziana, 2018. "Do behaviours in cultural markets affect economic resilience? An analysis of the Italian regions," MPRA Paper 83904, University Library of Munich, Germany.
    14. Robert J. Stimson, 2012. "Troubling Times-The GFC and its Implications for Regional Performance. Part One: The United States And Europe," Romanian Journal of Regional Science, Romanian Regional Science Association, pages 1-30.

    More about this item

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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