Estimating the Impact of Regional Labor Demand Shocks on Unemployment Using the Synthetic Control Method: Evidence from the Shuttle Program and Florida's Space Coast
21 Pages Posted: 20 Nov 2017 Last revised: 26 Oct 2018
Date Written: November 1, 2017
The discontinuation of the Shuttle program (STS) had a measurable impact on unemployment in Florida's Space Coast, particularly in the years since the initial layoffs in aerospace industries. Estimates of the impact using the synthetic control method suggest that the unemployment rate increased on average 0.41 percentage points per year (~7.5%) every year for 6 years observed in post-treatment. I demonstrate the robustness of the estimated result to various placebo tests.
Keywords: Synthetic Control, Unemployment, Regional Economics
JEL Classification: J4, R1, J69
Suggested Citation: Suggested Citation