Georgeanne M. Artz

Measuring the Impact of Meat Packing and Processing Facilities in Nonmetropolitan Counties: A Difference-in-Differences Approach

Considerable controversy exists regarding the costs and benefits of growth in the meat packing and processing industry for rural counties. This study investigates the effects of this industry on social and economic outcomes in nonmetropolitan counties of 23 Midwestern and Southern states from 1990 to 2000. Results suggest that as the meat packing industrys share of a countys total employment and wage bill rises, total employment growth increases. However, employment growth in other sectors slows, as does local wage growth. Industry growth has little impact on local crime rates or on growth of government spending on education, health, or police protection.

Off-Farm Employment Effects on Adoption of Nutrient Management Practices

Off-farm income as a share of total farm household income has been increasing. Previous studies found inconsistent results regarding the impact of off-farm income on adoption of conservation practices. We test the hypothesis that off-farm employment has a positive impact on adoption of capital incentive practices and a negative impact on adoption of labor-intensive practices. The results confirm that adoption of injecting manure into the soil, a capitalintensive practice, is positively and significantly impacted by off-farm employment of the operator. However, off-farm employment variables had no effect on adoption of record keeping.

Does agglomeration matter everywhere?: new firm location decisions in rural and urban markets

We test whether commonly used measures of agglomeration economies encourage new firm entry in both urban and rural markets. Using new firm location decisions in Iowa and North Carolina, we find that measured agglomeration economies increase the probability of new firm entry in both urban and rural areas. Firms are more likely to locate in markets with an existing cluster of firms in the same industry, with greater concentrations of upstream suppliers or downstream customers, and with a larger proportion of college‐educated workers in the local labor supply. Firms are less likely to enter markets with no incumbent firms in the sector or where production is concentrated in relatively few sectors. The same factors encourage both stand‐alone start‐ups and establishments built by multiplant firms. Commuting decisions exhibit the same pattern as new firm entry with workers commuting from low to high agglomeration markets. Because agglomeration economies are important for rural firm entry also, policies encouraging new firm entry should focus on relatively few job centers rather than encouraging new firm entry in every small town.

A Return of the Threshing Ring? A Case Study of Machinery and Labor-Sharing in Midwestern Farms

Machinery-sharing provides an alternative for smaller producers to obtain the efficiencies of large farming operations and remain competitive in an increasingly concentrated agricultural industry. This research uses a multiple case study design to examine the motivations for sharing equipment and labor among farms and to better understand how group members handle the transaction costs of sharing. Our case evidence finds that in addition to cost savings, access to reliable labor is an important motivation for participating in a sharing arrangement. Trust and frequent communication among group members helps to minimize the transaction costs incurred from sharing.

Revisiting WalMart’s Impact on Iowa Small-Town Retail: 25 Years Later

Ken Stone conducted the first study of WalMart stores’ economic impact in Iowa in 1988. Since then, research on WalMart’s impacts has exploded. Recent studies employ sophisticated statistical techniques to more accurately measure the size and direction of effects. Many reach conclusions similar to Stone’s original work. This article updates the original Stone study with additional years of data. It draws on recent methodological advances to help account for the effects of WalMart’s strategic location decisions on estimated retail sales in Iowa. As is consistent with previous studies, we find that WalMart’s entry into smaller trade centers in Iowa had a big initial impact on host-town retail sales, with some categories experiencing significant increases while others saw declines in sales per capita. WalMart’s presence helped stabilize or even expand the local retail sector of most rural Iowa host communities. To conclude, we discuss policy implications for local economic development officials.

How ya Gonna Keep ’em Down on the Farm Which Land Grant Graduates Live in Rural Areas?

This article analyzes factors related to the rural/urban residence choice of college-educated adults using a unique data set resulting from a 2007 stratified random sample survey of Iowa State University alumni graduating between 1982 and 2006. Rural origin is the most significant predictor of rural residence choice. An important finding is that nonpecuniary goals and values such as family tradition, being respected by friends, and building a business for one’s children to inherit have more weight with Iowa State University alumni who reside in rural areas after college than do monetary returns. This implies that incentives such as tax breaks will not work, or will be too expensive, to attract or retain college graduates in rural areas. Second, entrepreneurship rates are higher among Iowa State University alumni in rural areas and rural entrepreneurs tend to have local or, at least, rural roots. This finding lends support to the increasingly popular “grow your strategies” for rural business development.

The cooperative capital constraint revisited

Purpose - – There is little reason a priori to expect that a cooperative firm’s capital needs are different from a non-cooperative firm’s needs if the two firms are otherwise similar in function and size and operate within similar market economies. However, the notion that cooperatives face capital constraints that investor-owned firms (IOFs) do not is a persistent theme in the literature. The paper aims to discuss these issues. Design/methodology/approach - – The authors revisit this hypothesis with an empirical examination of capital constraints in a panel data set of US agricultural supply and grain cooperatives and IOFs. Findings - – The findings are mixed. While the authors find little to suggest that cooperatives face financial constraints on borrowing in the short run, relative to IOFs, the authors do find some evidence that for long-term investments, a capital constraint may exist. Originality/value - – These short and long run differences have implications for the survival and growth of agricultural cooperatives. While in the short run, access to debt financing allows these firms to operative profitably, ultimately long-term large investments in technology and fixed assets will be required to maintain competitiveness in this industry.

Do state business climate indicators explain relative economic growth at state borders

This study submits eleven business climate indexes to tests of their ability to predict relative economic performance on either side of state borders. Our results show that most business climate indexes have no ability to predict relative economic growth regardless of how growth is measured. Some are negatively correlated with relative growth. Many are better at reporting past growth than at predicting the future. In the end, the most predictive business climate index is the Grant Thornton Index which was discontinued in 1989.

DO STATE BUSINESS CLIMATE INDICATORS EXPLAIN RELATIVE ECONOMIC GROWTH AT STATE BORDERS

This study submits eleven business climate indexes to tests of their ability to predict relative economic performance on either side of state borders. Our results show that most business climate indexes have no ability to predict relative economic growth regardless of how growth is measured. Some are negatively correlated with relative growth. Many are better at reporting past growth than at predicting the future. In the end, the most predictive business climate index is the Grant Thornton Index which was discontinued in 1989.

Does the Jack of All Trades Hold the Winning Hand? Comparing the Role of Specialized versus General Skills in the Returns to an Agricultural Degree

This paper examines the roles of specialized versus general skills in explaining variation in the returns to an agriculture degree among graduates working both inside and outside the agricultural industry. The focus on returns by sector of employment is motivated by our finding that most agricultural graduates are employed in non-agricultural jobs. In that study, a sample of alumni graduating from a large Midwestern public university between 1982 and 2006 shows that alumni with majors more specialized in agriculture earned a premium from working in the agriculture industry, but this advantage has diminished over time. Agricultural graduates with more general training earn more outside than inside agriculture. Higher-ability graduates in more industry-focused curricula tend to sort into the agricultural industry, while higher-ability graduates in broader curricula tend to choose jobs outside of agriculture. All graduates are more likely to accept agricultural employment when the farm economy is strong, but agricultural graduates who enter agricultural jobs when the farm economy is weak suffer lifetime earnings reductions. These findings suggest that greater levels of specialization may limit a graduates ability to adjust to changing economic circumstances. Agriculture degree programs could benefit from curriculum innovations that focus on developing more generalized skills.