The Appalachian Regional Development Act of 1965 is one of the longest serving place-based regional development programs in the U.S., and is the largest in terms of geographic scope. I use county-level data from the 1960 thru 2000 Decennial Censuses to evaluate the effect of ARDA on poverty rates and real per capita incomes in Appalachia. The intent to treat parameter is identified in a difference-in-difference-in-difference framework by comparing outcomes in Appalachia to her border counties. Additional knowledge of which counties were solely eligible for highway development funds under ARDA from those counties eligible for both highway as well as human development programs helps isolate the average treatment effect on the treated. The results suggest that the ARDA reduced Appalachian poverty between 1960 and 2000 by 4.2 percentage points relative to border counties, or about 10 percent on the baseline 1960 poverty rate, and real per capita incomes grew about 4 percent faster. Comparing grant eligible to grant ineligible counties suggests that about half of poverty reduction can be attributed to highway development programs, and the other half to human development programs. These anti-poverty gains were concentrated exclusively in the Central and Southern Appalachian regions.
Discussion Paper Number
Ziliak, James P., "The Appalachian Regional Development Act and Economic Change" (2010). University of Kentucky Center for Poverty Research Discussion Paper Series. 51.