U.S. Micropolitan Area Growth: A Spatial Equilibrium Growth Analysis

Because micropolitan areas have only relatively recently been defined, little is known about their comparative economic performance. Part of the interest in micropolitan areas stems from the successful ones often growing to become metropolitan areas. This paper examines micropolitan area growth during the 1990s, a period of strong national growth. A spatial equilibrium growth framework and estimated reduced-form regressions containing an extensive number of variables are used to assess the sources of differentials in micropolitan area growth. To varying degrees, at various levels, and through various channels, it is found that household amenity attractiveness, firm location considerations, and housing supply policies, all underlie micropolitan area growth differentials.