RURAL HOUSEHOLD ECONOMIC ADJUSTMENT MECHANISMS AND ATTITUDES TOWARDS PUBLIC INVESTMENTS

• Sponsoring Institution: National Institute of Food and Agriculture
• Project Status: COMPLETE
• Funding Source: NRI COMPETITIVE GRANT
• Reporting Frequency: Annual
• Accession No.: 0196892
• Grant No.: 2003-35401-13781
• Proposal No.: 2003-02563
• Project Start Date: Aug 15, 2003
• Project End Date: Aug 14, 2005
• Grant Year: 2003
• Program Code: [62.0]- (N/A)

Recipient Organization
MICHIGAN STATE UNIV
(N/A)
EAST LANSING,MI 48824

Performing Department
AGRICULTURAL, FOOD & RESOURCE ECONOMICS

Non Technical Summary
This proposed research will examine how rural households perceive the impact of macro economic change in their home communities and what they anticipate and value as alternative strategies. We are concerned with how rural households perceive this threat and how they adjust to the actuality of economic contraction. How do households and communities plan for uncertain futures? How do individuals and households determine and value alternative investments in light of threatening economic crisis?

Animal Health Component

50%

Research Effort Categories

Basic

50%

Applied

50%

Developmental

(N/A)

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
608	6050	3010	50%
608	6050	3080	50%

Knowledge Area
608 - Community Resource Planning and Development;

Subject Of Investigation
6050 - Communities, areas, and regions;

Field Of Science
3010 - Economics; 3080 - Sociology;

Keywords

mining

economic development

households

rural areas

mechanisms

agricultural economics

strategies

rural families

natural resources

rural communities

discounts

investments

attitudes

sociology

social economics

capital

decision making

interviews

focus groups

savings

finance

family resources

macroeconomics

social change

Goals / Objectives
The specific objective of the proposed research is to examine how trade-offs between consumption and investment decisions related to capital development are made by estimating and comparing personal and social discount rates of rural households across mining-dependent and other counties

Project Methods
We propose a regional study of Michigan's Upper Peninsula plan relying primarily on telephone-based surveys and secondary data available through published sources. The study focuses on Michigan's Upper Peninsula. Pilot work will begin with expert interview, focus group interviews and secondary data analyses that will establish the bases for a regional telephone survey of rural households. Loveridge and Bokemeier will collaborate with the Office of Survey Research (OSR) at Michigan State University's Institute for Public Policy and Social Research (See attached program description) and Kakela to develop a telephone survey targeting the Upper Peninsula region of Michigan. The research team (especially Kakela) has an established record of work in the Upper Peninsula and thus knows this region well. The survey design will be enhanced by exploratory interviews with key informants. With this prior knowledge and focus group and expert interviews with key community and industry leaders in the UP, the survey instrument will be formulated and preliminary results from secondary analyses will be validated. These informant interviews will help formulate scenarios for the discount rate and household strategy questions as well as to determine the critical contextual variables. We will examine secondary datasets such as Census, BEA, State, and industry data to identify regional indicators of place-based characteristics that may differentially influence rural household strategies. The regional survey will include a base set of questions for all households including income and employment status, community attachment, union status, propensity to migrate, and perceptions of community quality of life. To assist in survey question development and to consider correlates of household well-being and alternative scenarios volleys of test questions will be given to subsamples. The time constraints for telephone surveys of a maximum of 20 to 25 minutes can be managed by randomized assignment of selected sets of questions. This requires the larger sample size of 1400 cases. The primary unit of analyses is the rural household. A randomized process will be used to select the adult age 18-64 to be the respondent. A random sample of rural households will be selected with over sampling in the counties with the greatest proportion of mining employees. John Beck, a labor-management negotiations expert has agreed to assist us in working with the relevant unions to identify mining employee households for a selected sub-sample. Following the survey data collection, IPPSR will provide a SPSS database with county FIPS codes for each household. County data from secondary sources will be merged with the household survey data based on FIPS codes. Thus, consideration of contextual contingencies can be empirically examined.

Progress 08/15/03 to 08/14/05

Outputs
The project team conducted more analysis of the data and presented preliminary results at the professional meeting, "Regional Science Association International." The team also traveled to the the Upper Peninsula to report summary preliminary results to local leaders and colleagues at Northern Michigan University. Feedback from these events has helped the team adjust the interview schedule for the national survey to be conducted in 2006.

Impacts
Better understanding of determinants of community willingness to invest in longer term development strategies.

Publications

• Loveridge, S., J. Bokemeier, and P. Kakela. 2005. "Jobs Today, Tomorrow, or....Never? Results of a Survey of Residents of Michigans Upper Peninsula." Paper presented at the annual conference of the Regional Science Association International, Las Vegas, NV. November.

Progress 01/01/04 to 12/31/04

Outputs
In 2004, the Michigan Upper Peninsula telephone survey was developed, field tested, and fielded. Data collection began in May and ended in September. Roughly 1200 responses were recorded. Preliminary analysis shows that gender, personal income, length of tenure in the community, and expectations all play a role in whether or not an individual will take the long view in community development or personal gain.

Impacts
We expect the main impact of the work to be a better understanding of why communities often choose short-term, high risk economic development strategies over longer term but seemingly lower risk options. The research also has general implications for how cost-benefit analysis is conducted.

Publications

• Loveridge, S., Bokemeier, J. and Kakela, P. 2004. Social and Personal Discount Rates and Willingness to Move Away in Michigan's Upper Peninsula. Paper presented at the Regional Science Association International meetings, Seattle, Washington. November 2004.

Progress 01/01/03 to 12/31/03

Outputs
This report covers the first 4.5 months of the project. The study area is Michigan's Upper Peninsula. We are examining community and individual attitudes towards the future by estimating discount rates via a telephone survey. To appropriately design the telephone survey, the project conducted focus groups with Upper Peninsula key informants. The focus group sessions were recorded and common themes and attitudes towards personal savings and community-based economic development strategies were synthesized. Results shaped questionnaire design and sampling strategies.

Impacts
We expect the main impact of the focus group sessions to be better response rates, more understandable scenarios in the survey instrument, and therefore better estimates of discount rates and factors affecting an individual's personal and social discount rates.

Publications

• No publications reported this period