Recent volatility in oil and natural gas markets has led to questions about how local businesses and government revenues might be affected. This paper uses a panel dataset of Oklahoma counties during 2003–2012 to quantify the relationship between changes in oil and natural gas employment and retail spending. One particularly noteworthy contribution is the use of sub-categories of retail sales (to the two-digit Standard Industrial Classification code) to assess whether specific retail sectors are more responsive to changes in oil and gas activity. Our fixed effects panel regression model reveals that variations in mining employment impact aggregate retail expenditures, with an overall elasticity of 0.02. These results are driven by the grocery and furniture sectors, with elasticities of 0.05–0.06, and are even stronger when the analysis is limited to counties considered to be mining-dependent. We also show that spillover effects exist, with the grocery and furniture expenditures highly impacted by mining employment in neighboring counties as well as their own.

The academic literature on economic development incentive programs has generated mixed results, though most studies conclude that incentives do not lead to economic growth. Oklahoma has received high praise for its innovative Quality Jobs program, because it provides cash payments (not tax incentives) and emphasizes jobs with high wages and benefits. However, few evaluations of the program's success in growing the state's economy have been made. This study employs multivariate regression and mixed-pair analysis techniques and concludes that the economic growth between 1990 and 2005 was not statistically different between Oklahoma communities with businesses participating in the Quality Jobs program and those that were not participating. There was, however, a statistical difference in median household income growth when Oklahoma communities with participating businesses were compared with similar Kansas communities.

Purpose– As an economic development strategy, entrepreneurship policies should target innovative activities – those which Schumpeter described as leading to new goods, production methods, markets, input sources, or new industries. However, popular entrepreneurship proxies, such as firm births (<500 employees) and sole proprietorships, capture multiple types of entrepreneurship which may have conflicting qualities. To address the need for more accurate measures of Schumpeterian activity, indices are constructed to specifically measure the relative amount of Schumpeterian activity among US states. The paper aims to discuss these issues.Design/methodology/approach– Four composite indices of Schumpeterian activity are constructed using different methods to combine variables related to innovative activity into single indicator, since there is uncertainty about the weighting of dimensions: principal component analysis (PCA), factor analysis (FA), data envelopment analysis and equal weights. Robustness checks were used to compare state rankings across indices. These indices were also compared to common entrepreneurship proxies and real GDP to demonstrate and justify their measurement of Schumpeterian activity.Findings– The results show that the Schumpeterian Activity Indices (SAIs) similarly rank states and measure phenomena different from the common proxies of entrepreneurship. Furthermore, these indices better predict GDP than the common proxies. Lastly, state rankings based upon the SAIs support previous research suggesting that innovation and agglomeration economies are interrelated.Originality/value– The paper demonstrates a methodology for constructing a measure of innovative activity, which is necessary to develop and evaluate entrepreneurship policy for economic development.

PurposeThe paper aims to examine the relationship between broadband availability and firm establishment growth rates by employment size and by industry to assess the impact of broadband on small business growth in Kentucky.Design/methodology/approachThe paper uses a modified growth model as the theoretical foundation for empirical analysis.FindingsBroadband availability does increase growth in small and medium‐sized businesses. While broadband does tend to affect specific industries differently, the scope of the affects is limited to only a few industries: broadband encourages growth in small manufacturing firms, but discourages growth in financial services.Research limitations/implicationsThe scope of analysis is limited to the period of 2003‐2005, while some of the counties in Kentucky did not have sizable broadband deployment until 2005. Owing to the lack of data availability, the current research does not consider demand‐side factors, though several industries considered are likely to be demand‐driven rather than cost‐driven.Originality/valueUtilizing unique broadband saturation data for Kentucky counties, this study presents ex‐post analysis of the effect of broadband deployment on local economies.

High-speed access to the Internet enhances economic prosperity, social development and global competitiveness. Significant progress has been made in broadband deployment in the last decade. Nevertheless, there are increasing gaps in broadband adoption, use and speed between, as well as within, the states. Federal and state legislators and regulators currently use a number of indicators such as adoption, availability and speed to track states' progress in broadband diffusion in order to design appropriate policy responses. Single indicators, however, when analyzed individually, fall short of capturing multi-dimensional aspects of broadband diffusion and, thus, do not provide an integrated and easily comprehensible picture of states' advancement. To monitor states' overall progress it is useful to aggregate various indicators into a composite index that could measure the overall extent of broadband diffusion. A composite index can also provide with an important benchmark for designing policies to improve states' overall performance. This paper offers a flexible framework for benchmarking states' achievement in broadband diffusion by proposing a composite Broadband Achievement Index (BAI). The index combines several key performance indicators: broadband availability, adoption, competition, speed and the dispersion of broadband adoption within the states utilizing FCC's Form 477 data and the recently collected census block level broadband availability data from NTIA. The purpose is to provide a more comprehensive picture of where the states stand in their evolution toward high-performance America by measuring each state's current broadband achievement relative to other states and providing an important benchmark for assessing state-specific needs. The indicators are combined using the Benefit of the Doubt (BOD) methodology (Cherchye, Moesen, & Van Puyenbroeck, 2004). The methodology is founded on the premise that, absent a consensus on social policy priorities, that are, on which indicators are more important and should be given higher weights in the index, each state is granted leeway for deciding how to weigh its own indicators and the most favorable weights for indicators are determined for each state. A good relative performance in a particular dimension is seen as revealed evidence of setting high state policy priority to that indicator, when each state's specific policy priorities are unknown. Additionally, the Second Order Stochastic Dominance (SOSD) methodology is used to compare the dispersion of adoption in the states. Using SOSD the states are ranked under the assumption that proportionally higher and more equally distributed adoption rates are better.

Many rural communities are adopting entrepreneurship and small business development services as components of their economic development programs. As rural communities face declining tax bases (due to out-migration) and recession-related fiscal stress, knowing which of these programs best utilizes scarce funds is critical. A partial answer to this question comes by understanding which services small business owners utilize and which contributed to their success. Using data collected from a random sample of 1,200 Oklahoma households via a telephone survey, we identify which locally provided services (mentoring, small business management training, locally-provided funds – including state and federal subsidized loans, incubator) small business owners in Oklahoma used, and we assess the correlation between the use of services and the business owners’ perceived success across three measures: overall business success, employment growth, and financial success.

According to neoclassical economics, geographic differences in the supply of and demand for labor are a primary cause of population migration (Todaro and Maruszko, 1987). People who live in labor-surplus areas, which usually have lower wages, tend to migrate to labor-scarce areas, which usually have higher wages. Generally, the labor-scarce areas have relatively higher economic growth with more industries and manufacturing concentration than the labor-surplus areas. In a neoclassical world, these differences in supply and demand cause immigration, as areas with high economic growth tend to experience in-migration (Hendrink, 2001). In recent years new concepts have altered the neoclassical view of migration theory. These concepts center around the idea that people not only consider economic activity factors but also the infrastructure and amenity factors that can improve their quality of life (Greenwood, 1985).