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Abstract

This study assesses the initial economic outcomes of the Delta Regional Authority (DRA), which began funding rural development projects in the Mississippi Delta region in 2002. The study focuses on non-metropolitan DRA counties and similar counties elsewhere in the Mississippi Delta region and the southeast, using a quasi-experimental approach that combines matching methods, double and triple difference and switching regression estimation. We find that per capita income and transfer payments grew more rapidly in DRA counties than similar non-DRA counties, and that these impacts are larger in counties in which DRA spending was larger. Each additional dollar of DRA spending per capita is associated with an increase of $15 in personal income per capita between 2002 and 2007, including an increase of $8 in earnings (primarily in the health care and social services sector) and $5 in transfer payments. The increase in transfer payments is mainly due to increased medical transfer payments. We also find that the number of hospital beds per capita increased more in counties where DRA spending per capita was greater. These findings suggest that investments supported by the DRA in improved medical facilities are promoting additional health sector earnings and medical transfer payments.

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