Rural and Urban Establishment Births and Deaths Using the U.S. Census Bureau’s Business Information Tracking Series

Lawrence A. Plummer and Brian Headd

The Office of Advocacy Small Business Working Papers from U.S. Small Business Administration, Office of Advocacy

Abstract: This paper serves two related purposes. First, we conduct a preliminary descriptive analysis of the establishment birth and death rates by rural and urban counties. This analysis gives a surprising result: when measured by the ecological and labor force method, the rural versus urban differences in the average rates of establishment births and deaths are extremely small. While the difference is statistically significant, on average, the general dynamic of economic activities is not a function of rural versus urban conditions. It is expected, though, that such a dynamic specific to a particular industry will show strong urban versus rural effects. This result has implications for the setting and study of economic development policy for both rural and urban areas, especially where such policies hinge on stimulating and supporting local entrepreneurial activity (i.e., “economic gardening”). Note that the ecological and labor force methods provided similar results, so the choice of method for analyzing birth rates has no significant impact on the results. Second, it documents a set of establishment birth and death (EBD) tabulations now available from the U.S. Census’ Company Statistics Division. In particular, we provide an overview of the Census database from which the tabulated data were extracted, summarize the information and variables in the data, and discuss several practical issues with using the EBD tabulations. Among these issues are the reliability of the data, the industry and county classifications used in reporting the data, and issues concerning statistical analysis in a spatial context. We also discuss how the EBD tabulations and other custom data orders can be obtained.

Pages: 52 pages
Date: 2008
New Economics Papers: this item is included in nep-ent and nep-ure
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