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Regional economic resilience, adaptive capacity, and underlying factors: insights from Canadian regions during the COVID-19 pandemic

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  • Jesse Sutton

    (Western University)

  • Yawo Mamoua Kobara

    (University of Windsor)

  • Godwin Arku

    (Western University)

Abstract

This paper investigates how key determinants of economic resilience influence the adaptive capacity of regions during turbulent times. Specifically, the adaptive performance of Canadian regions during the COVID-19 pandemic-induced economic crisis in 2020 is examined. In doing so, regional adaptive capacity is decomposed into its two underlying components: regional adaptation and adaptability. To undertake such an investigation, multivariate cross-sectional regressions are employed, using a bootstrapping method. Our results show that (1) human capital has a positive effect on regional adaptability; (2) related variety has a positive effect on regional adaptation but a negative effect on regional adaptability; (3) unrelated variety has a negative effect on regional adaptation but a positive effect on regional adaptability. One central policy recommendation is that local officials should tailor their diversification efforts to the needs of their regions, whether that is the need to maintain their current path through the process of adaptation or shift their industrial path through the process of adaptability.

Suggested Citation

  • Jesse Sutton & Yawo Mamoua Kobara & Godwin Arku, 2025. "Regional economic resilience, adaptive capacity, and underlying factors: insights from Canadian regions during the COVID-19 pandemic," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 74(3), pages 1-22, September.
    • Handle: RePEc:spr:anresc:v:74:y:2025:i:3:d:10.1007_s00168-025-01414-1
    DOI: 10.1007/s00168-025-01414-1
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    JEL classification:

    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;

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