Specialisation Vs Diversification. Which One Better Upholds Regional Resilience to Economic Crises?

As economic crises periodically disrupt the economic activity, a large and continuously growing literature was dedicated to understanding the reasons behind the crises, their mechanism, effects and, most of all, the determinants of resilience capacity, and the ability to overcome hardships by adapti...

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Bibliographic Details
Published in:Journal of Social and Economic Statistics 2019-12, Vol.8 (2), p.11-23
Main Author: Goschin, Zizi
Format: Article
Language:English
Subjects:
economic resilience
R11
R15
region
spatial model
specialization
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Summary:As economic crises periodically disrupt the economic activity, a large and continuously growing literature was dedicated to understanding the reasons behind the crises, their mechanism, effects and, most of all, the determinants of resilience capacity, and the ability to overcome hardships by adapting and changing. By preparing in advance for economic shocks through resilience building during good times, the impact of economic crises can be attenuated. Starting from these considerations, the paper focuses on regional economic specialization and its opposite – economic diversification, two business strategies already acknowledged in the literature as relevant factors for the capacity to mitigate economic crises. We tested the hypothesis of vulnerability-inducing economic specialization in the Romanian economy, using NUTS3 level data and found that more diversified regional economies were better at coping with the hardships triggered by the recent recession.
ISSN:2285-388X
2285-388X
DOI:10.2478/jses-2019-0002