Estimating the Impact of Regional Labor Demand Shocks on Unemployment Using the Synthetic Control Method: Evidence from the Shuttle Program and Florida's Space Coast

21 Pages Posted: 20 Nov 2017 Last revised: 26 Oct 2018

See all articles by David Vitt

David Vitt

Farmingdale State College

Date Written: November 1, 2017

Abstract

The discontinuation of the Shuttle program (STS) had a measurable impact on unemployment in Florida's Space Coast, particularly in the years since the initial layoffs in aerospace industries. Estimates of the impact using the synthetic control method suggest that the unemployment rate increased on average 0.41 percentage points per year (~7.5%) every year for 6 years observed in post-treatment. I demonstrate the robustness of the estimated result to various placebo tests.

Keywords: Synthetic Control, Unemployment, Regional Economics

JEL Classification: J4, R1, J69

Suggested Citation

Vitt, David, Estimating the Impact of Regional Labor Demand Shocks on Unemployment Using the Synthetic Control Method: Evidence from the Shuttle Program and Florida's Space Coast (November 1, 2017). Available at SSRN: https://ssrn.com/abstract=3072470 or http://dx.doi.org/10.2139/ssrn.3072470

David Vitt (Contact Author)

Farmingdale State College ( email )

School of Busines
Farmingdale, NY 11735

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