Economic Resilience and Regional Covid-19

Transcript:Economic Resilience and Regional Covid-19:
Economic Resilience and Regional Covid-19 Policies: Exploring mitigation strategies in the Netherlands. Mark Thissen Frank van Oort Anet Weterings 12-07-2023 IMF Policy Tracker Countries with regional Covid19 policy responses Australia, China, France, Germany Guyana, Guinea, Iran, Italy Jordan, Kazachstan, Maldives Myanmar, Namibia, Peru Polen, Russia, Spain, Togo Turkey, Ukraine, US Regional-economic Covid19 Policies Impact studies: Regional differences, institutions and policies (Bourdin et al. 2021, Rodriguez-Pose et al. 2021, Porsse et al. 2021, McCann et al 2021, 2022). Regional Employment consequences (Bartik et al. 2020, Doerr et al. 2020, Gardiner et al, 2021, Capello et al. 2022, Kim et al 2023). Sector composition and Trade (Meinen et al 2021, Brakman et al. 2020). Mitigation Studies: Targetting specific groups (Bricongne and Meunier 2021, Baldwin en Di Maura 2020). Targetting regions (Crucinni & O’Flaherty 2020, Bonardi et al. 2021). Interregional market mechanims: Self-organising capacities of regional economies (Polenske & Hewings 2005). Place-based Policies Domestic version: “Industrial Transfer Policies" (ITP). Policy instruments: encourage both the movement of workers (migration) and manufacturing jobs from coastal areas to inland areas. Aims: promote urbanization and create manufacturing hubs in targeted inland cities. Example of so-called “big-push” interventions (Duranton & Venables 2021, Grover et al. 2022). What are the demographic and economic impacts of ITP on targeted cities? First, we match ITP targeted cities with cities that were similarly likely to receive the treatment from central government. Second, we estimate how migration and economic outcomes differ between ITP cities and their closest matches. A Wicked Problem How to determine optimal regional economic mitigation policies when the policy objective is non-economic? No easy optimization rules (goal conflict) resulting in Too many regional combinations of policy options (complexity) 6 policy options in 12 Dutch regions gives more than 2 billion possible combinations Where results are highly uncertain (informational uncertainty) Wicked problems are generally characterized by: System complexity, goal conflict and informational uncertainty (Irschke et. al., 2019) where wickedness is a matter of degree (Head and Alford, 2015). A Wicked Problem Model sector and region-specific model of Supply Based on productivity effects of policy measures via the labor market. Model sector and region-specific model of Demand Interregional Input-Output based, focused on the demand in producing region. Determine region specific excess demand\supply Determine potential benefit from interregional economic interaction. The degree of coexisting sector specific excess demand and excess supply over different regions. We use mixed integer programming to find an optimal