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Show Me the Evidence: Growth and Prosperity

by Eben Fodor

Most cities in the U.S. have operated on the assumption that growth is inherently beneficial and that more and faster growth will benefit local residents economically. Local growth is often cited as the cure for urban ailments, especially the need for local jobs. But where is the empirical evidence that growth is providing these benefits?

I have completed a new study examining the relationship between growth and prosperity in U.S. metro areas. I found that those metro areas with the most growth fared the worst in terms of basic measures of economic well-being.

The study looked at the 100 largest U.S. metro areas (representing 66% of the total U.S. population) using the latest federal data for the 2000-09 period. The average annual population growth rate of each metro area was compared with unemployment rate, per capita income, and poverty rate using graphical and statistical analysis.

Some of the remarkable findings:

  • Faster-growing areas did not have lower unemployment rates.
  • Faster-growing areas tended to have lower per capita income than slower-growing areas. Per capita income in 2009 tended to decline almost $2,500 for each 1% increase in growth rate.
  • Residents of faster-growing areas had greater income declines during the recession.
  • Faster-growing areas tended to have higher poverty rates.

I also compared the 25 slowest-growing and 25 fastest-growing areas. The 25 slowest-growing metro areas outperformed the 25 fastest-growing in every category and averaged $8,455 more in per capita personal income in 2009. They also had lower unemployment and poverty rates.

Another remarkable finding is that stable metro areas (those with little or no growth) did relatively well. Statistically speaking, residents of an area with no growth over the 9-year period tended to have 43% more income gain than an area growing at 3% per year. Undoubtedly these findings offer a ray of hope that stable, sustainable communities may be perfectly viable — even prosperous — within our current economic system.

Click here to download the new study.

Eben Fodor is the founder of Fodor & Associates, a consulting firm that specializes in community planning, land use, and environmental sustainability.  Fodor is also the author of Better, Not Bigger: How to Take Control of Urban Growth and Improve Your Community.

7 Responses to “Show Me the Evidence: Growth and Prosperity”

  1. Bruce E. Woych says:

    http://jwsr.ucr.edu/archive/vol9/number2/pdf/jwsr-v9n2-hornborg.pdf (see full text here)
    Cornucopia or Zero-Sum Game? The Epistemology of Sustainability*
    Alf Hornborg

    Alf Hornborg
    Human Ecology Division
    Lund University

    i TRIED TO POST REFERENCES AND COMMENTS WITH THIS BUT THE SYSTEM ACCUSED ME OF “SPAMMY” MATERIAL. CHECK OUT THIS ARTICLE IT COMPLIMENTS YOUR STUDY PERFECTLY.

    FIX YOUR SYSTEM; IT’S NOT UP TO SUSTAINABLE ACADEMIC STANDARDS.

  2. Bruce E. Woych says:

    http://www.futurity.org/earth-environment/reforestation-efforts-a-zero-sum-game/

    WORTH NOTING THAT REFORESTATION AND GLOBALIZATION OFFSET EACH OTHER. SO TOO WITH CLASS DISPLACEMENT AND THE COST SHIFTING OF ECONOMIC BENEFITS (PROFITS AND PRICING) OVER ACTUAL EMPLOYMENT STABILITY OR INSTABILITY IN HUMAN “CAPITAL” MODELS.

  3. Bruce E. Woych says:

    eCONOMIC INCENTIVES TRUMP ECOLOGICAL IDEALS AND CONSTRAINTS IN REAL WORLD DISEQUILIBRIUM AND POLITICAL ECOLOGY:

    http://www.ethiopianreview.com/content/11687

  4. vera says:

    Thank you, I’ve thought this has been a boondoggle.
    But why not take it the next obvious step and tell us whether in the fast growing areas the rich get richer (more than the rich in the slow growing areas)? There is a reason, after all, why growth is sold so ardently… (?)

  5. [...] Show me the evidence: Growth and prosperity Most cities in the U.S. have operated on the assumption that growth is inherently beneficial and that more and faster growth will benefit local residents economically. Local growth is often cited as the cure for urban ailments, especially the need for local jobs. But where is the empirical evidence that growth is providing these benefits? I have completed a new study examining the relationship between growth and prosperity in U.S. metro areas. I found that those metro areas with the most growth fared the worst in terms of basic measures of economic well-being. [...]

  6. Bruce ritchie says:

    VERA,
    I think that I understand a “boondoggle” to some degree, but ‘this’ has no anticedent, and therefore I am not REALLY sure what ‘this’ you are talking about. Is misuse of pronouns a woman thing, or am I just sexist? I do, however, wanna know about the income distribution in high growth vs slow/no growth areas as well. That would be a nugget of knowledge indeed!

  7. Bruce E. Woych says:

    New Film:

    http://www.theeconomicsofhappiness.org/

    “This was Ladakh’s introduction to globalization,” says Norberg-Hodge. The “story of Ladakh can shed light on the root causes of the crises now facing the planet.”

    The account of Ladakh’s transformation opens the new film, The Economics of Happiness, created by Steven Gorelick, John Page and Norberg-Hodge, the founder and director of the International Society for Ecology and Culture. As Bill McKibben says early on in the film, according to a poll conducted every year since the end of World World II, happiness in the U.S. peaked in 1956. “It’s been slowly downhill ever since,” he says. “But in that time we’ve gotten immeasurably richer, we have three times as much stuff. Somehow it hasn’t worked because that same affluence tends to undermine community.”

    Our consumer culture, driven by the engine of globalization, has resulted in an economic and environmental crisis — and, the film’s creators say, a crisis of the human spirit.

    read at:\
    http://www.alternet.org/story/149552/vision%3A_8_reasons_global_capitalism_makes_our_lives_worse_–_and_how_we_can_create_a_new_kind_of_economy_