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Title: Estimating a Dynamic Spatial Equilibrium Model to Evaluate the Welfare Implications of Regional Adjustment Processes: The Decline of the Rust Belt
Resulting in 1 citation.
1. Yoon, Chamna
Estimating a Dynamic Spatial Equilibrium Model to Evaluate the Welfare Implications of Regional Adjustment Processes: The Decline of the Rust Belt
International Economic Review 58,2 (May 2017): 473-497.
Also: http://onlinelibrary.wiley.com/doi/10.1111/iere.12224/abstract
Cohort(s): NLSY79
Publisher: Blackwell Publishing, Inc. => Wiley Online
Keyword(s): Current Population Survey (CPS) / CPS-Fertility Supplement; Economic Changes/Recession; Economics, Regional; Geocoded Data; Mobility; Skills

This article develops and estimates a new dynamic spatial equilibrium model to study the regional transition dynamics and its impact on individual and aggregate welfare. The model consists of a multiregion, multisector economy comprised of overlapping generations of individuals with heterogeneous skills and mobility costs. The empirical findings suggest that a large fraction of the decline of the Rust Belt can be attributed to the reduction in its region-specific comparative advantage in the goods-producing sector. This decline generated significant differences in welfare across regions. Policy experiments show that such inequality can be significantly reduced through place-based policies.
Bibliography Citation
Yoon, Chamna. "Estimating a Dynamic Spatial Equilibrium Model to Evaluate the Welfare Implications of Regional Adjustment Processes: The Decline of the Rust Belt." International Economic Review 58,2 (May 2017): 473-497.