Economic Performance of Ohio’s 88 Counties

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2004-09

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Abstract

The value added by the work force varies greatly among Ohio’s 88 counties. In the aggregate, the value added equals the gross domestic products (GDP) of the county. With an adjustment for depreciation, the value added by the county production system is equivalent to the aggregated real income (Y) of the county, the best measure of county economic performance. Measuring GDP or Y by aggregating all production of a region is a labor-intensive procedure. The purpose of this paper was to see if data on investment in real capital resources within the county and investment in human resources within the county (education) could be used to estimate domestic income without requiring a production census. Aggregated county income in Ohio was predicted reliably using county-specific data on the current value of taxable real property (investment in non-human resources), and the estimated value of the investment in educational attainment by the non-degreed work force of the county (human resources). A data vector for investment in the degreed work force was also used in the analysis. All vectors include values for the exhaustive set of Ohio’s 88 counties. A total of 9 regressions were computed using various combinations of the data. Using established statistical criteria the regression equation that uses investment in real capital and investment in the non-degreed work force was selected as the best method. These criteria included an R-square in excess of 0.99 and a mean square error that was smallest among the alternative regressions.

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Author Institution: Janson Industries, Canton, OH; Dept of Theoretical and Applied Mathematics; Dept of Statistics, University of Akron

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The Ohio Journal of Science, v104, n4 (September, 2004), 97-100.