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Abstract
This study estimates the short-run effects of the structure of the local economy
on high school dropout rates in agricultural areas in the United States from
2000 to 2010. Repeated cross-sections of census data are matched to state-level
agricultural price indices and data on the regional composition of employment.
Some authors theorise that human capital and land are substitutes, and increasing
returns to land-intensive activities may lower human capital investments.
I do not find empirical evidence of this in the rural United States. In fact, I find some evidence that as agriculture becomes more lucrative young people in
areas with very high levels of agricultural employment become more likely to
stay in school, not less, relative to those in areas with little or no agriculture
within each state.