Cash Transfers and the Export Base of Small Communities.

This paper propose an export base model of local employment growth where one of the "export" sectors is cash transfer payments to individuals. The basic sector considered are: agriculture, manufacturing, inter-governmental transfers, and cash transfer to individuals. The model is tested with a sample of U.S. counties using data from secondary sources. Cash transfers are found to have strong positive effects on local nonbasic employment growth. Manufacturing and agriculture were also found to have significant effects. Also in the model are ecological qualities such as industrial diversity and urbanization of the local community. The findings and hypothesis are discussed in relation to the "population turnaround" of nonmetropolitan communities, the growth of social welfare payments, the economic significance of cash transfers to local communities, and the Keynesian macro approach to economic growth. [ABSTRACT FROM AUTHOR]