The effects of local public overhead capital investments on the economic growth and development of non-metropolitan Tennessee

The primary objectives of this research were to define, identify, and measure local public investments in overhead capital in nonmetropolitan Tennessee; describe the relationships between these investments and population size and density; describe and analyze the hypothesized relationships between these investments and per capita annual income, which was used as a proxy for the level of economic growth and develop-ment; and determine the marginal rates of substitution among these investments in increasing per capita annual income. The data for analysis were taken from secondary sources. The relationships between the public overhead capital investments and the population size and density were analyzed tabularly and by computing correlation coefficients. Multiple regression analysis was employed to isolate the relationships between overhead capital investments and per capita annual income. All of the hypothesis put forth were accepted. In general, the counties with the larger population and the greater population density tend to have the greater per capita overhead capital expenditures. Per capita personal income tends to be higher in counties with larger populations, in counties nearer to an SMSA, in counties with an access to an interstate highway, and in counties with greater per capita expenditures for overhead capital. The results of this study seem to reinforce the importance of local public investments in overhead capital in relation to economic growth and development. However, because of the exploratory nature of this study and of problems of measurement with many of the variables, no conclusive recommendations for public policy can be made regarding the utilization of local public overhead capital as a tool for economic growth and development.