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Modeling Small Businss Growth, Migration behavior, and Household Income in Appalachia: A Spatial Simultaneous Equations Approach

Author

Listed:
  • Gebremeskel Gebremariam

    () (Department of Economics, Virginia Tech)

  • Tesfa Gebremedhin

    () (Regional Research Institute, West Virginia University)

  • Peter Schaeffer

    () (Division of Resource Management, West Virginia University)

Abstract

In this paper, a spatial simultaneous equations model of business growth, migration behavior and median household income is empirically estimated. The empirical simultaneous model is developed from the equilibrium relationships among these variables where each variable is assumed to adjust to its equilibrium level with a substantial lag through a partial equilibrium adjustment process. We use Generalized Spatial Three-Stage Least Squares estimator to estimate the empirical model using data from 418 Appalachian counties for 1990-2000. The results suggest the existence of very strong interdependences among business growth, migration behavior and median household income in the form of feed-back simultaneities, spatial autoregressive lag simultaneities and spatial cross-regressive lag simultaneities.

Suggested Citation

  • Gebremeskel Gebremariam & Tesfa Gebremedhin & Peter Schaeffer, 2006. "Modeling Small Businss Growth, Migration behavior, and Household Income in Appalachia: A Spatial Simultaneous Equations Approach," Working Papers Working Paper 2006-08, Regional Research Institute, West Virginia University.
  • Handle: RePEc:rri:wpaper:2006wp08
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    References listed on IDEAS

    as
    1. Duffy-Deno, Kevin T. & Eberts, Randall W., 1991. "Public infrastructure and regional economic development: A simultaneous equations approach," Journal of Urban Economics, Elsevier, vol. 30(3), pages 329-343, November.
    2. Kelly D. Edmiston, 2004. "The Net Effects of Large Plant Locations and Expansions on County Employment," Journal of Regional Science, Wiley Blackwell, vol. 44(2), pages 289-320.
    3. Kelejian, Harry H & Prucha, Ingmar R, 1998. "A Generalized Spatial Two-Stage Least Squares Procedure for Estimating a Spatial Autoregressive Model with Autoregressive Disturbances," The Journal of Real Estate Finance and Economics, Springer, vol. 17(1), pages 99-121, July.
    4. Thomas Aronsson & Johan Lundberg & Magnus Wikstrom, 2001. "Regional Income Growth and Net Migration in Sweden, 1970-1995," Regional Studies, Taylor & Francis Journals, vol. 35(9), pages 823-830.
    5. Rupasingha, Anil & Goetz, Stephan J., 2004. "County Amenities and Net Migration," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 33(2), October.
    6. Barkley, David L. & Henry, Mark S. & Bao, Shuming, 1998. "The Role of Local School Quality in Rural Employment and Population Growth," The Review of Regional Studies, Southern Regional Science Association, vol. 28(1), pages 81-102, Summer.
    7. Greenwood, Michael J & Hunt, Gary L, 1984. "Migration and Interregional Employment Redistribution in the United States," American Economic Review, American Economic Association, vol. 74(5), pages 957-969, December.
    8. Mills, Edwin S. & Price, Richard, 1984. "Metropolitan suburbanization and central city problems," Journal of Urban Economics, Elsevier, vol. 15(1), pages 1-17, January.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Appalachia; Simultaneous Model; Small Business; Migration; Household Income;

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • P28 - Economic Systems - - Socialist Systems and Transition Economies - - - Natural Resources; Environment

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