Job Reallocation, Entrepreneurship, & Regional Resilience during the Great Recessio

The years following the Great Recession have been marred by several alarming economic trends. The slow recovery of employment, very low productivity growth, and historic lows in inter-regional migration and new firm creation all raise concerns about the dynamism of the US economy. Traditionally, recessions have been periods of intensified economic change, and at best these changes improve aggregate productivity through creative destruction. Yet, the changes that occurred during the Great Recession do not appear on the surface to have had beneficial effects. In this dissertation, I examine the US economy during the Great Recession and recovery from a regional perspective to bring new insights into the decline in US economy dynamisms.;Chapter I: Much attention has been given to the process of "creative destruction" during the business cycle in which employment is reallocated from low productivity firms to firms that are more productive. Yet, the process of job reallocation across regions has never been evaluated. This paper provides the first description of inter-regional job reallocation during the Great Recession, and tests whether this reallocation was consistent with productivity enhancing creative destruction. I find that during the recession period of 2007--2010, counties with lower levels of productivity lost a larger share of employment than high productivity regions, consistent with the "trimming effect" associated with creative destruction. Yet, during the recovery period from 2010 to 2014, high productivity counties did not grow faster than low-productivity regions. Taken together, these results are inconsistent with productivity enhancing job reallocation during the Great Recession, pointing to the need for policies that address barriers that are prevent firms and labor from relocating to the most productive regions in the US.;Chapter II: Past recessions and recoveries have been periods of increased entrepreneurship as new firms replace old, low productivity firms that downsize or go out of business. Theory and past research have shown that human capital is a critical driver of entrepreneurship, although it is not clear that this relationship has held in the period since the Great Recession. Since 2010, entrepreneurship has reached historic lows, even as overall human capital in the US economy has increased. I consider this relationship in the context of the recovery following the Great Recession, a period in which high skilled entrepreneurs would theoretically have an increased incentive to start new firms. Introducing a novel measure for regional entrepreneurship that focuses specifically on new firms that hire wage and salary workers, I find that counties that had a larger share of college educated wage and salary workers prior to the Great Recessions had lower levels of entrepreneurship during the recovery. This finding challenges the existing literature on the relationship between human capital and entrepreneurship, and highlights the need to re-evaluate state and federal policies that incentivize wage and salary employment.;Chapter III: Interest in analyzing the dynamics of the Great Recession among regional economists has largely focused on 'regional resilience.' This concept, while still not fully formed, considers the relationship between regional characteristics and the regional response to economic shocks, particularly the Great Recession. Yet, one key barrier to the development of this line of research is a lack of consensus on how to operationalize and measure regional resilience. Researchers typically make arbitrary decisions on how to define the timing, duration, and magnitude of recessionary shocks at the regional level, confounding the analysis and making comparisons across studies difficult. In this paper, I develop a novel approach to defining the time, duration, and magnitude or regional recessionary shocks. I use methods common to regional economics to decompose exogenous recessionary shocks from the regional response to the shock. Using this method, I demonstrate how researchers can use this approach to conduct regional resilience analysis using data for US counties and MSAs.