Thursday, March 28, 2019

Op-ed: Funding certain research universities could help revitalize rural America

Noah Smith
Rural areas are losing population: fewer people are born there and more people move away from there when they grow up. And as recent Bureau of Labor Statistics noted, nine in 10 jobs in the past decade have gone to the biggest cities. Many have brainstormed about how to rejuvenate rural America. Noah Smith, a columnist for Bloomberg and former assistant professor of finance at New York's Stony Brook University, writes that more government subsidies and private investment in second-tier research universities would be a big help.

"Big cities aren’t the only places to benefit from knowledge industries; college towns also thrive in the new economy," Smith writes. "Economists have found that cities where the U.S. government began setting aside land-grant money for public universities in the 19th century tend to be richer and more productive in the modern day. In a review of local economic policies, economists David Neumark and Helen Simpson cite several papers showing real positive effects of government efforts to create university-centered clusters."

Though government subsidies to college towns helps inject money into local economies, "economists Jaison Abel and Richard Deitz have found that the biggest impact probably comes from university research," Smith writes. "By attracting smart people to the region and drawing in private investment, research universities harness the forces of knowledge-industry clustering to increase the wealth of an entire region." Read more here.

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