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EDA and ARC Expenditures Preliminary Analysis

Larry Wood

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This paper was produced as a part of the EDA and ARC Expenditures Analysis Project.

Introduction: This report summarizes an initial, exploratory analysis of Economic Development Administration (EDA) and Appalachian Regional Commission (ARC) expenditure data. EDA and ARC efforts are arguably the two largest federal economic development projects ever undertaken in the United States.

Congress authorized the inauguration of both agencies in the mid-1960s, at a time when there was bipartisan belief in the federal government that conditions in regions of economic distress could not improve due to market forces alone. This analysis is a preliminary assessment of all economic development expenditures allocated by both the EDA and ARC during the period 1965–1997. It includes an examination of EDA allocations to approximately 45,000 projects and ARC allocations to approximately 12,000 projects, or virtually every economic development project funded by these two agencies at the county level from their inception until 1997. Most allocations from both agencies were made on a county-level basis. This report begins with descriptions of EDA and ARC policies and concludes with a comparison of the funding trajectories of these two agencies over time. This analysis is primarily concerned with assessing the types of counties based upon a measure of economic distress to which the EDA and ARC have allocated funds throughout their histories.