Abstract
The strength of the 2008 financial and economic crisis and the resulting degree of resilience were heterogeneous among and within the European Union countries. Challenges and opportunities driven by regional-specific differences determined the ability to overshoot the precrisis levels of growth. Focusing upon Nomenclature of Territorial Units for Statistics 2 (NUTS 2) European regions, we explore a novel conceptual framework related to regional economic resilience, namely the renewal capacity. Precisely, we concentrate on the capacity of regional economies to “renew” their growth paths in the labor market in the aftermath of the recent global crisis. We find some well-identified spatial patterns of regional employment renewal and we identify a set of territorial assets that allow regions to bounce back faster and more comprehensively than others to the economic downturn. Furthermore, there are significant differences between the drivers of the regional renewal of Old and New Member States. Our findings suggest potential policy directions at all levels for enhancing regional resilience.
Highlights
The Great Recession has severely impacted countries’ labor markets all over the world
As it will be shown in the empirical section, this preference is confirmed from the results of the Lagrange multiplier (LM) test for spatial dependence performed on the residuals of the ordinary least square (OLS) regression
This implies the existence of the socalled spatial spillovers due to the spatial multiplier calculated as (1 À r)À1 that are comprised between 1.81 and 1.89, that is, between 81 percent and 89 percent of employment renewal is already reflected in neighborhood employment renewal, through indirect reaction effects from the neighbors
Summary
The Great Recession has severely impacted countries’ labor markets all over the world. This article investigates whether and how differences in performances and economic virtuosity prior to the 2008 global downturn affected the employment trajectories of European regions after the crisis. The relevance of employment in shaping regional economic resilience has been recently confirmed by Pontarollo and Serpieri (2020a). This indicator is widely used to test resilience as it reflects the social impact of the recessionary shocks better than output (Fratesi and Rodrıguez-Pose 2016). The second strand focuses on regional economic resilience, where a growing theoretical and empirical literature concentrates on testing the differentiated reactions of regions to negative shocks, mainly identifying with the recent Great Recession
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