Small Cities Blues: Looking for Growth Factors in Small and Medium-Sized Cities

Authors

George A. Erickcek, W.E. Upjohn Institute for Employment ResearchFollow
Hannah J. McKinney, Kalamazoo College

Series

Upjohn Institute Working Paper No. 04-100

**Published Version**

In Economic Development Quarterly, 20(3): 232-258

DOI

10.17848/wp04-100

Issue Date

June 2004

Abstract

The purpose of this exploratory study is to attempt to identify particular public policies which have the potential to increase the economic viability of smaller metropolitan areas and cities. We identify characteristics associated with smaller metro areas that performed better-than-expected (winners) and worse-than-expected (losers) during the 1990s, given their resources, industrial mix, and location as of 1990. Once these characteristics have been identified, we look for evidence that public policy choices may have promoted and enhanced a metro area's ability to succeed and to regain control of its own economic destiny. Methodologically, we construct a regression model which identifies the small metro areas that achieved higher-than-expected economic prosperity (winners) and the areas that saw lower-than-expected economic prosperity (losers) according to the model. Next, we explore whether indications exist that winners and losers are qualitatively different from other areas in ways that may indicate consequences of policy choices. A cluster analysis is completed to group the metro areas based on changes in a host of social, economic, and demographic variables between 1990 and 2000. We then use contingency table analysis and ANOVA to see if "winning" or "losing," as measured by the error term from the regression, is related to the grouping of metro areas in a way that may indicate the presence of deliberate and replicable government policy.

Subject Areas

ECONOMIC DEVELOPMENT; Regional policy and planning; Urban issues