Industrial Structure and a Tradeoff between Productivity and Resilience

15 Pages Posted: 10 Dec 2020

See all articles by Shade T. Shutters

Shade T. Shutters

Arizona State University (ASU) - School of Complex Adaptive Systems

Keith Waters

George Mason University - Schar School of Policy and Government

Date Written: September 30, 2020

Abstract

We analyze how a region’s industrial structure affects its productivity and its resilience to shocks. Using co-occurrence analysis, we construct an interdependence network of U.S. industries. For each U.S. metropolitan area, we then calculate an aggregate metric of this network called economic tightness, which captures the interconnectedness among a region’s industries. We find that tightness is positively correlated with economic productivity but negatively correlated with a region’s change in productivity following the Great Recession, revealing a tradeoff between higher productivity and higher resilience. We further find that productivity is higher in metropolitan areas with industry pairs that rarely occur together.

Keywords: regional science, cities, workforce, resilience, Panarchy, co-occurrence

JEL Classification: R1, O10, J01, L16

Suggested Citation

Shutters, Shade T. and Waters, Keith, Industrial Structure and a Tradeoff between Productivity and Resilience (September 30, 2020). Available at SSRN: https://ssrn.com/abstract=3702545 or http://dx.doi.org/10.2139/ssrn.3702545

Shade T. Shutters

Arizona State University (ASU) - School of Complex Adaptive Systems ( email )

PO Box 872701
Tempe, AZ 85287-2701
United States

Keith Waters (Contact Author)

George Mason University - Schar School of Policy and Government ( email )

Founders Hall, Fifth Floor
3351 Fairfax Drive, MS 3B1
Arlington, VA 22201
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
30
Abstract Views
189
PlumX Metrics