Full Citation

Title: The Decline of the U.S. Rust Belt: A Macroeconomic Analysis

Citation Type: Working Paper

Publication Year: 2014

ISBN:

ISSN:

DOI:

NSFID:

PMCID:

PMID:

Abstract: No region of the United States fared worse over the postwar period than the Rust Belt, the heavy manufacturing zone bordering the Great Lakes. We argue that a lack of competition in labor and output markets in the Rust Belt were responsible for much of the regions decline. We formalize this theory in a dynamic general-equilibrium model in which productivity growth and regional employment shares are determined by the extent of competition. When plausibly calibrated, the model explains roughly half the decline in the Rust Belts manufacturing employment share. Industry evidence support the models predictions that investment and productivity growth rates were relatively low in the Rust Belt.

Url: http://www.frbatlanta.org/documents/cqer/publicationscq/cqerwp/cqer_wp1405.pdf

User Submitted?: No

Authors: Alder, Simeon; Lagakos, David; Ohanian, Lee

Series Title:

Publication Number: 14-05

Institution: Center for Quantitative Economic Research

Pages:

Publisher Location: Atlanta, Georgia

Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure, Methodology and Data Collection, Other

Countries: