NEW STUDY COMPARES REAL PER CAPITA INCOMES ACROSS THE COUNTRY
Two Old Dominion University economics professors have price adjusted real per capita income to compare the relative standard of living among 219 United States metropolitan areas for 1998. It is the only study of its kind to look at buying power throughout the country.
The study, conducted by Gilbert R. Yochum and Vinod B. Agarwal, took metropolitan area nominal personal income and population figures from the 1998 Regional Economic Information System (REIS) of the U.S. Department of Commerce and weighted them for cost-of-living differences to achieve "real" per capita income figures. The study used 1998 relative price index data from the American Chamber of Commerce Research Association's (ACCRA) third quarter 1998 price index of metropolitan areas.
"Prices for goods and services differ between U.S. metropolitan areas," noted Yochum and Agarwal. "A dollar of income in Los Angeles cannot buy the same bundle of goods and services as it can in Oklahoma City. Therefore, comparisons of economic living standards based solely on the nominal per capita income of a particular area leaves a less than accurate picture of any area's relative level of economic development and well-being."
According to the study, the top 10 metropolitan areas by real per capita personal income are: West Palm Beach/Boca Raton, Fl. ($36,536); New Haven/Bridgeport/ Stamford/Danbury/Waterbury, Ct. ($35,200); Dallas, Tx. ($32,866); Houston, Tx. ($32,837); Minneapolis/St. Paul, Mn. ($32,806); Sarasota/Bradenton, Fl. ($32,243); Omaha, Ne. ($31,649); Denver, Co. ($31,537); Baltimore, Md. ($30,779); and Des Moines, Ia. ($30,725).
The bottom 10 metropolitan areas by real per capita income are: Sumter, SC ($18,437); Flagstaff, Az. ($18,344); Provo/Orem, Ut. ($18,046); Visalia/Tulare/Porterville, Ca. ($17,413); Yuma, Az. ($17,357); El Paso, Tx. ($17,293); Las Cruces, NM ($16,716); New York, NY ($15,701); Brownsville/Harlingen/San Benito, Tx. ($14,691); and McAllen/Edinburg/Mission, Tx. ($14,052).
For more information about the study, call Dr. Yochum at 757-683-3535 or Dr. Agarwal at 757-683-3526.