A1572
Title: Testing and quantifying economic resilience
Authors: Naoko Hara - Seikei University (Japan) [presenting]
Yohei Yamamoto - Hitotsubashi University (Japan)
Abstract: A formal testing procedure is proposed to examine economic resilience that applies even when a cross-section of a control group is unavailable and circumvents bias in time-series regressions using data with structural breaks. Novel measures of shock absorption and cumulative recovery are provided. Empirical analysis shows that most advanced economies were not resilient to the Global Financial Crisis, while many were resilient during the COVID-19 pandemic. These results challenge the view that a single set of determinants governs economic resilience, showing instead that factors such as Financial leverage and labor market regulation are associated with lower resilience, while other determinants matter in a Crisis-dependent manner.
