Appendix: Variable Definitions, Sources and Sample Statistics

Population Growth for the age group, county, and farm or nonfarm status is measured by the difference in log population over consecutive census years.  Unpublished census data were used to correct for changes in the definition of a farm that occurred in 1980.

Median Income in the county was divided by average family size.  In years when the income was not reported separately for either the farm population (1950) or the nonfarm population, the missing data was approximated by solving the equation YT = "FYF + (1 - "F) YNF  where YT is median income in the county, "F is farm share of total population, and YF (YNF) is farm (nonfarm) income.  This created measurement error in the estimate of farm and nonfarm income, necessitating the need for instrumental variable methods to correct for the measurement error.

Human Capital measures include the percent of the population aged 25 and over who have completed a high school degree and the median years of schooling completed for that age group.

Local Government Policy  measures were only available for the second and seventh years of each decade.  Observations within a decade we averaged so as to generate a representative estimate of the policy at the midpoint of the decade.  Because the policies may change in response to population changes, these variables are instrumented by exogenous variables dated at the start of the decade.

            Measures of state government tax and highway expenditure policies are dated at the start of the decade, as are federal highway funds.  These are treated as exogenous to individual county population growth.

Demographic Variables are self-explanatory.  The proportion of the county that are on farms, under 15, over 64, or black are taken directly from census data.

Local amenities and prices include median gross monthly rent measured at the start of the decade.  Separate decade dummy variables control for changes in prices that are common across rural counties.  Measures of county average rainfall and temperature are included as local amenities.

Herfindahl employment index is measured by , where Ej is the jth one-digit SIC industry’s share of total employment in the county.  In log form, the index varies from minus infinity to zero with zero being the case where all employment is concentrated in one industry.

Distance to the nearest city of over 100,000 was computed from maps.

Instrumental variables used were intended to measure local cost of providing public services such as the suitability of local soil types for road construction, cost of county rural road construction per mile, county average teacher pay, and union membership as a percentage of the labor force in the state.  Local poverty was measured as the percentage of families in the county with income less than $5000 in 1980 dollars.  This is used as a measure of local taste for public services.  To help identify nonfarm versus farm income, measures of value of farm land and buildings per acre, the proportion of farm revenues from crop production and average acres per farm.

 

An electronic copy of the data may be downloaded from http://www.econ.iastate.edu/faculty/

orazem/.

 


Appendix: Sample Statistics and Data Sourcesa

ENDOGENOUS VARIABLES

Source

Mean

S.D.

Population Growth:

 

 

 

    

 

 

 

Overall 20-64

Census of Population

-.002

.18

            20-34

Census of Population

-.058

.27

Farm    20-64

Census of Population

-.388

.32

            20-34

Census of Population

-.515

.45

Nonfarm 20-64

Census of Population

.128

.21

              20-34

Census of Population

.072

.27

 

 

 

 

Government Policy

 

 

 

County per capita welfare expenditure

Compendium of Government Finances

1.30

2.68

County per capita education expenditure

Compendium of Government Finances

5.86

.52

County highway expenditure

Compendium of Government Finances

7.12

.98

County per capita debt outstanding

Compendium of Government Finances

5.88

1.12

County per capita tax revenue

Compendium of Government Finances

5.47

.77

 

 

 

 

Median per person income

 

 

 

Farm

Census of Population

8.48

.53

Nonfarm

Census of Population

8.59

.41

 

 

 

 

EXOGENOUS VARIABLES

 

 

 

Median income per person

Census of Population

8.55

.44

Median school years completed

Census of Population

2.29

.18

Percent of population with high school degree

Census of Population

3.56

.48

Distance to a city with population > 100,000

Computed by authors

4.47

.72

Herfindahl index of employment

Census of Population

-1.56

.30

Rent

Census of Housing

5.16

.36

State government highway expenditure

Compendium of Government Finances

13.01

.58

Proportion on farm

Census of Population

-1.50

.88

Proportion black

Census of Population

-.63

2.57

Proportion less than 15 years old

Census of Population

-1.28

.25

Appendix Table (continued)

Source

Mean

S.D.

Proportion 65 years and over

Census of Population

-2.16

.32

Average January temperature

ISU Department of Agronomy

3.30

.57

Average July temperature

ISU Department of Agronomy

4.34

.05

Average annual rainfall

ISU Department of Agronomy

3.54

.40

 

 

 

 

Instruments

 

 

 

Per capita state taxes (state level)

State Government Finances

5.95

.50

Percent of low income households

Census of Population

2.92

.68

Average teacher salary

Digest of Educational Statistics

8.93

.31

Cost of primary rural road per mile

Highway Statistics

6.31

.93

Cost of secondary rural road per mile

Highway Statistics

4.93

1.04

Federal highway funds per mile (state level)

Highway Statistics

3.55

.74

Percent of union membership

Statistical Abstract, Union Sourcebook, and Directory of National Unions and Employee Associations

3.09

.37

Soil suitability for local roads

Map Unit Interpretation Record Database

.27

.19

Soil suitability for roadfill

Map Unit Interpretation Record Database

.41

.23

Percent of farm revenue in crops

Census of Agriculture

3.35

.90

Average farm size (acres)

Census of Agriculture

5.55

.86

Value of land and building per acre

Census of Agriculture

6.10

.80

 

aAll variables in natural logarithms.