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Abstract

Transfer payments (cash or goods, mostly from Government programs, received by individuals for which no work is currently done) are an important source of income in nonmetro areas, accounting for 18.7 percent of annual personal income. Social Security and medical payments account for nearly two-thirds of transfer payments to nonmetro areas. Transfers, which continue even if local employment falls during recessions, may make local economies more stable in the short run. However, nonmetro economies that greatly depend on transfer income may be sensitive to changes in Government programs affecting the payments.

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