Distance from urban agglomeration economies and rural poverty

TLDR: In this paper, the authors used a novel geographical information system database of county-urban proximity measures to examine the nexus between poverty in rural U.S. counties and their remoteness, particularly in regard to their geographical proximity to larger urban centers.

Abstract: Despite strong growth during the 1990s economic expansion being accompanied by significant reductions in measures of U.S. poverty, high poverty persisted in remote rural areas. Therefore, this study uses a novel geographical information system database of county-urban proximity measures to examine the nexus between poverty in rural U.S. counties and their remoteness, particularly in regard to their geographical proximity to larger urban centers. We find that poverty rates are positively associated with greater rural distances from successively larger (higher-tiered) metropolitan areas ( ceteris paribus ). We explain this outcome as arising from the attenuation of urban agglomeration effects at greater distances and incomplete labor supply adjustments in remote rural areas in the form of commuting and migration. Yet, although our results suggest that they are at a disadvantage in terms of reduced benefits from urban agglomeration economies, remote rural areas also may particularly benefit from place-based economic development policies in terms of their effect on poverty.