EXAMINING THE ROLE OF SPATIALLY DISTRIBUTED AMENITIES IN ECONOMIC DEVELOPMENT IN ALABAMA

The paper extends the work of Deller et al (2001) by introducing a spatial component in a structural growth model to capture the role of spatially distributed variables using county-level data. The premise of the analysis is that what is true at a national level may provide a partial or misleading picture when we look at particular areas. Additionally, data available at the state level can often provide richer, more precise information than what is found at the national level, so we try to explore in more depth the role of spatially distributed amenities in economic development by examining, for instance the valuable Alabama countryside features such as natural habitats, scenic landscapes and warm weather amidst a poverty of infrastructure. The estimated results demonstrate a strong relationship between quality of life amenities and economic growth; with most conforming to theory and expectations while others exhibit unexpected relationship.