Impacts of political fragmentation on inclusive economic resilience: Examining American metropolitan areas after the Great Recession

Abstract

We propose the concept of inclusive economic resilience to examine intra-regional economic recovery in American metropolitan areas after the Great Recession. Previous studies have treated regional and municipal economic resilience separately, with little attention to within-region variations in economic resilience. We contribute to the understanding of regional economic resilience by focusing on intra-regional economic recovery in cities. We also introduce an important yet overlooked regional factor in the context of American federalism – fragmentation of local governments. Examining US metropolitan areas from 2007 to 2017, we find that different dimensions of local fragmentation exert different impacts on intra-regional economic resilience. Our results indicate that a large number of municipal governments and greater service responsibilities borne by special and school districts lead to uneven economic recovery. In contrast, similar fiscal responsibilities taken by municipal governments promote inclusive income recovery.