What makes one economy more resilient than another? | CSIRO blog

Thanks to Frank Aquino for sending this article by By Stephan J. Goetz, David Fleming, Yicheol Han. What caught my eye (emphasis added) was:

What makes a county resilient

Our key findings are that counties with higher shares of relatively young workers (aged 25-44 years) on average had lower resilience, suggesting that having a more experienced labor force allowed counties to cope better after the financial crisis.

Surprisingly, having a more highly educated workforce, on the other hand, did not appear to make a county more resilient. As expected, though, a higher share of self-employed workers in a county was unambiguously associated with greater resilience.

Our research also showed that counties with greater diversity succeeded in warding off a severe recession but diversity did not contribute to a resumption of growth. That is, counties with greater diversity experienced a smaller drop, but they also did not enjoy a rapid recovery. Ultimately, higher levels of diversity are associated with less resilience.

On the other hand, counties with more complex economies also avoided large drops but experienced faster recoveries, and thus they were more resilient.

Interestingly, when we examined the link between the two (by observing how the variables diversity and complexity interacted), we found that their interaction led to a stronger positive effect for both variables. This means that the effect of complexity on resilience becomes more positive at higher levels of diversity, while diversity’s impact turns positive at higher levels of complexity.

Clearly, this is worthy of further exploration in future research.

Source: What makes one economy more resilient than another? – CSIRO blog