The Impact Of Population Change On Business Activity In Rural America by Kenneth M Johnson

Author:Kenneth M Johnson [Johnson, Kenneth M]
Language: eng
Format: epub
Tags: Social Science, Sociology, Rural
ISBN: 9780865315846
Google: LYm3AAAAIAAJ
Publisher: Avalon Publishing
Published: 1985-09-10T03:48:21+00:00

The Causal Impact of Population Change on the Selected Services

The causal model presented here specifies and estimates empirically the relationship between population change and shifts in the structure of the service sector. Assigning population change an independent role oversimplifies a complex causal structure; however, because most of the services considered here depend on local patronage, they are sensitive to local population shifts.3 Income change is included as a second exogeneous variable, but the absence of county-level income data before 1949 limits analysis to the period from 1948 to 1972.4

During this period, population change (POP4872) exerted a strong causal impact on service receipts (SLE4872) (Figure 4.1). A growing population increased the magnitude of the receipts gain. And, although a loss of population rarely caused an absolute decline in receipts, it slowed the rate of increase in comparison with that of a growing county.

The volume of service receipts also depends on how much residents have to spend, as is indicated by the moderately strong causal impact of income change (INC4969) on receipts. Income gains greater than the nonmetropolitan average caused higher levels of service spending than would be expected otherwise. However, income change had less impact on receipts than did population shifts. Together, population and income accounted for 23 percent of the variation in receipts, and the absence of a correlation between them suggests that each made an independent contribution.

Change in the number of establishments serving a county (EST4872) is the first indicator of organizational adjustment in the local service structure. Of the two exogeneous variables, population change had the strongest causal influence on how many units provide services to a county. Most of this influence was direct, but there was also a significant indirect effect (.23) mediated through change in receipts. In contrast, income change exerted a minimal indirect effect (.10) on establishment change.

Figure 4.1 Path Diagram of Population Change and its Impact on the Service Structure

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