IDEAS home Printed from https://ideas.repec.org/p/ags/aaea04/19928.html
   My bibliography  Save this paper

Measuring The Effect Of Rural Residence On Individual Employment Outcomes: Is Rural Residence Endogenous?

Author

Listed:
  • Fisher, Monica G.
  • Foster, Kenneth A.

Abstract

This paper examines the relationship between annual hours worked and rural residence for a sample of working-age (18-64 years) householders using 1993 Panel Study of Income Dynamics data. The basic question we address is whether and to what extent failure to account for rural residential choice biases the measured effect of rural residence on labor market outcomes. Results from a single equation model that assumes rural residence is exogenous finds no statistically significant relationship between annual hours worked and living in a rural area. By contrast, a simultaneous model that accounts for the possibility that rural residence is a choice indicates that rural people worked 307 hours more than urban people, all else being equal. A Smith-Blundell test for exogeneity of rural residence suggests that rural location should be treated as a choice variable. Study findings highlight the importance of testing, and if necessary, correcting for endogeneity of rural residence if we are to obtain accurate measures of the effect of living in a rural location on individual behavior and well-being.

Suggested Citation

  • Fisher, Monica G. & Foster, Kenneth A., 2004. "Measuring The Effect Of Rural Residence On Individual Employment Outcomes: Is Rural Residence Endogenous?," 2004 Annual meeting, August 1-4, Denver, CO 19928, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea04:19928
    DOI: 10.22004/ag.econ.19928
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/19928/files/sp04fi24.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.22004/ag.econ.19928?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Bradford F. Mills & Gautam Hazarika, 2003. "Do Single Mothers Face Greater Constraints to Workforce Participation in Non-Metropolitan Areas?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(1), pages 143-161.
    2. Ihlanfeldt, Keith R. & Sjoquist, David L., 1989. "The impact of job decentralization on the economic welfare of central city blacks," Journal of Urban Economics, Elsevier, vol. 26(1), pages 110-130, July.
    3. William N. Evans & Wallace E. Oates & Robert M. Schwab & William N. Evans & Wallace E. Oates & Robert M. Schwab, 2004. "Measuring Peer Group Effects: A Study of Teenage Behavior," Chapters, in: Environmental Policy and Fiscal Federalism, chapter 13, pages 232-257, Edward Elgar Publishing.
    4. Weber, Bruce A. & Jensen, Leif, 2004. "Poverty And Place: A Critical Review Of Rural Poverty Literature," Working Papers 18913, Oregon State University, Rural Poverty Research Center (RPRC).
    5. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
    6. Maureen Kilkenny & Sonya Kostova Huffman, 2003. "Rural/Urban Welfare Program and Labor Force Participation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 914-927.
    7. Smith, Richard J & Blundell, Richard W, 1986. "An Exogeneity Test for a Simultaneous Equation Tobit Model with an Application to Labor Supply," Econometrica, Econometric Society, vol. 54(3), pages 679-685, May.
    8. Davis, Elizabeth E. & Connolly, Laura S. & Weber, Bruce A., 2003. "Local Labor Market Conditions and the Jobless Poor: How Much Does Local Job Growth Help in Rural Areas?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(3), pages 1-16, December.
    9. Tubagus Feridhanusetyawan & Maureen Kilkenny, 1996. "Rural/Urban Residence Location Choice," Food and Agricultural Policy Research Institute (FAPRI) Publications (archive only) 96-wp157, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    10. Charles Brown & Greg J. Duncan & Frank P. Stafford, 1996. "Data Watch: The Panel Study of Income Dynamics," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 155-168, Spring.
    11. David M. Cutler & Edward L. Glaeser, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(3), pages 827-872.
    12. Nawata, Kazumitsu, 1994. "Estimation of sample selection bias models by the maximum likelihood estimator and Heckman's two-step estimator," Economics Letters, Elsevier, vol. 45(1), pages 33-40, May.
    13. Euan Phimister & Esperanza Vera-Toscano & Alfons Weersink, 2002. "Female Participation and Labor Market Attachment in Rural Canada," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 210-221.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fisher, Monica G., 2004. "On The Empirical Finding Of A Higher Risk Of Poverty In Rural Areas: Is Rural Residence Endogenous To Poverty?," Working Papers 18917, Oregon State University, Rural Poverty Research Center (RPRC).
    2. Zenou, Yves & Battu, Harminder & Mwale, MacDonald, 2003. "Do Oppositional Identities Reduce Employment for Ethnic Minorities?," CEPR Discussion Papers 3819, C.E.P.R. Discussion Papers.
    3. Bruce A. Weinberg & Patricia B. Reagan & Jeffrey J. Yankow, 2004. "Do Neighborhoods Affect Hours Worked? Evidence from Longitudinal Data," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 891-924, October.
    4. Harminder Battu & Yves Zenou, 2010. "Oppositional Identities and Employment for Ethnic Minorities: Evidence from England," Economic Journal, Royal Economic Society, vol. 120(542), pages 52-71, February.
    5. Cicala, Steve & Fryer, Roland G. & Spenkuch, Jörg L., 2011. "A Roy Model of Social Interactions," MPRA Paper 29150, University Library of Munich, Germany.
    6. Steven N. Durlauf & Yannis M. Ioannides, 2010. "Social Interactions," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 451-478, September.
    7. Sjoquist, David L., 2001. "Spatial Mismatch and Social Acceptability," Journal of Urban Economics, Elsevier, vol. 50(3), pages 474-490, November.
    8. Card, David & Rothstein, Jesse, 2007. "Racial segregation and the black-white test score gap," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2158-2184, December.
    9. Bruce Weber & Leif Jensen & Kathleen Miller & Jane Mosley & Monica Fisher, 2005. "A Critical Review of Rural Poverty Literature: Is There Truly a Rural Effect?," International Regional Science Review, , vol. 28(4), pages 381-414, October.
    10. Clifton-Sprigg, Joanna, 2014. "Educational spillovers and parental migration," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-46, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Marco Tonello, 2011. "Mechanisms of peer interactions between native and non-native students: rejection or integration?," Working Papers 2011/21, Institut d'Economia de Barcelona (IEB).
    12. Giulio Zanella, 2004. "Discrete Choice with Social Interactions and Endogenous Memberships," Department of Economics University of Siena 442, Department of Economics, University of Siena.
    13. Patrick Bayer & Stephen L. Ross, 2006. "Identifying Individual and Group Effects in the Presence of Sorting: A Neighborhood Effects Application," Working papers 2006-13, University of Connecticut, Department of Economics, revised Jan 2009.
    14. Tito Boeri & Marta De Philippis & Eleonora Patacchini & Michele Pellizzari, 2015. "Immigration, Housing Discrimination and Employment," Economic Journal, Royal Economic Society, vol. 125(586), pages 82-114, August.
    15. Susan E. Mayer, 2001. "How the Growth in Income Inequality Increased Economic Segregation," Working Papers 0117, Harris School of Public Policy Studies, University of Chicago.
    16. Picard, Pierre M. & Zenou, Yves, 2015. "Urban Spatial Structure, Employment and Social Ties: European versus American Cities," IZA Discussion Papers 9166, Institute of Labor Economics (IZA).
    17. Ross, Stephen L. & Zenou, Yves, 2008. "Are shirking and leisure substitutable? An empirical test of efficiency wages based on urban economic theory," Regional Science and Urban Economics, Elsevier, vol. 38(5), pages 498-517, September.
    18. Weinhardt, Felix, 2014. "Social housing, neighborhood quality and student performance," Journal of Urban Economics, Elsevier, vol. 82(C), pages 12-31.
    19. Anna Piil Damm, 2009. "Ethnic Enclaves and Immigrant Labor Market Outcomes: Quasi-Experimental Evidence," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 281-314, April.
    20. Harris Selod & Yves Zenou, 2006. "City Structure, Job Search and Labour Discrimination: Theory and Policy Implications," Economic Journal, Royal Economic Society, vol. 116(514), pages 1057-1087, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea04:19928. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.