Do Research Universities Recession Proof Their Regions? Evidence from State Flagship College Towns

22 Pages Posted: 30 Apr 2024 Last revised: 1 May 2024

See all articles by Robert Calvert Jump

Robert Calvert Jump

University of Greenwich - Business School

Adam Scavette

Federal Reserve Banks - Federal Reserve Bank of Richmond

Date Written: April 2, 2024

Abstract

Using synthetic differences-in-differences, we study whether U.S. counties containing state flagship universities experienced resiliency via lower unemployment rates during the past three U.S. recessions. We find a small but insignificant effect for the 2001 recession and a large resiliency effect for the 2008-2009 recession such that flagship counties endured 0.5 percentage point lower unemployment rates. However, flagship counties faced higher unemployment rates during the 2020 recession. The results support the hypothesis that stable consumption demand for non-tradable goods and services drives resiliency, which was absent during the 2020 recession when most university campuses were closed to students due to COVID-19 restrictions.

Keywords: Regional Business Cycles, Unemployment, Research Universities, Regional Resilience

JEL Classification: R11, R23, R53

Suggested Citation

Calvert Jump, Robert and Scavette, Adam, Do Research Universities Recession Proof Their Regions? Evidence from State Flagship College Towns (April 2, 2024). Available at SSRN: https://ssrn.com/abstract=4812119 or http://dx.doi.org/10.2139/ssrn.4812119

Robert Calvert Jump (Contact Author)

University of Greenwich - Business School ( email )

United Kingdom

Adam Scavette

Federal Reserve Banks - Federal Reserve Bank of Richmond ( email )

P.O. Box 27622
Richmond, VA 23261
United States

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