Parker, Tach, & Robertson: Federal Place-Based Policies in Rural Communities

In Do Federal Place-Based Policies Improve Economic Opportunity in Rural Communities?, Emily Parker (Population Studies Center, Michigan), Laura Tach (Sociology and Public Policy, Cornell), and Cassandra Robertson (Senior Policy and Research Manager, New America) cross-reference federal place-based funding data with a longitudinal study of youth from specific counties in order to assess whether exposure to place-based funding is associated with improved educational and economic outcomes for residents of rural areas.

While traditional people-based policy interventions “target individual sources of disadvantage—such as a lack of income for basic necessities including food, shelter, or childcare—place-based policies are motivated by a recognition that community conditions shape access to opportunity and quality of life above and beyond personal resources.”

Though most scholarly attention has focused on place-based policies in urban areas, the authors show that the federal government (following the People Left Behind report on rural poverty in 1967) has long used place-based approaches to address rural poverty. Indeed, the authors note that as many as 85 percent of “persistently poor” communities in the United States are in rural areas.

Figure: Total Place-Based Funding in Nonmetro Counties, 1990-2015

Source: Data compiled by authors from public records of federal agencies.

Note: Annual funding amounts adjusted for inflation to 2016 dollars. Geography based on 1990 OMB definitions.

While the authors acknowledge that the equity and efficiency of place-based policies remains an area of “active scholarly and public debate,” implementation of modern initiatives has shown localized successes. The authors also document a substantial increase in place-based funding over the 25-year study period (1990-2015) but note that, as a whole, “we still know little about the role of place-based policies in either reinforcing or disrupting spatial difference in economic opportunity.”

Ultimately, the authors find a strong association between living in a county that received more place-based funding and the existence of significantly higher educational attainment and earnings in adulthood. The rub, however, is that—especially for rural youth—this kind of upward mobility seems to exist only for those who leave their hometowns. In other words, high levels of place-based funding is associated with significant increases in education attainment and earnings, but that achievement and income increase is only enjoyed for rural youth who move out of their rural homes, not those who stay. The authors conclude that federal place-based investment in this way may actually be contributing to the so-called rural brain drain phenomenon.

While the authors concede there are a number of unknown factors that may have contributed to the migration of rural youth (i.e., no concrete evidence the youth came into direct contact with benefits of place-based funding, confounding variables including county leadership and management, etc.), the results are another piece of the complex puzzle in addressing rural poverty. Further examination of the unknown factors described by the authors could support a more targeted approach for actionable policy improvements.