Banking structure, economic resilience and unemployment trajectories in US counties during the great recession

Abstract How might the structure of banking affect economic resilience? We address this question by analyzing how organizational structures banks and markets were associated with unemployment trajectories in local economies during Great Recession. Two county-level analyses yield convergent results. Increasing branch densities giant derivative holding within greater surges unemployment, weaker employment recoveries stronger recession effects on from 2007 through 2016. community credit unions localism lower spikes, dampened crisis effects. These findings advance sociological studies finance providing new quantitative evidence for links between social performance. They also confound arguments that decentralized systems small, locally based financial institutions are inherently fragile design, suggesting instead alternatives to ‘too-big-to-fail’ can enhance economies’ capacities adapt proactively, withstand sustain recessions.