Identifying the size and geographic scope of short-term rural cost-of-living increases in the United States

Alberto Díaz-Dapena (), Scott Loveridge () and Dusan Paredes
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Alberto Díaz-Dapena: University of Oviedo
Scott Loveridge: Michigan State University

The Annals of Regional Science, 2024, vol. 72, issue 4, No 10, 1329-1351

Abstract: Abstract Difference in terms of cost-of-living between rural and urban areas is a frequent theoretical analysis in Regional Economics. Lack of routine measures in rural areas does not usually allow to observe changes in rural costs. We adapt the Big Mac index, typically used to measure purchasing power parity between countries, as a potential quick and inexpensive indicator of short-term local price variations. With a national random sample of McDonald's stores repeated in time, we find prices grew slightly faster in rural areas than in urban areas. Spatial transmission of prices seems to be limited to very localized effects, meaning that rural price increases are not due to urban spillover effects.

JEL-codes: D22 E31 O18 R11 R12 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s00168-023-01244-z

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