Despairing Communities in the United States

Abstract

While the United States enjoys aggregate economic growth, the fruits are not shared equally across communities. While there has been numerous news coverage about the despair of US communities recently, there has been little empirical study on what socio-economic factors affect the level of despair. In this paper, we collect US county-level data and construct an index of despair for each county, with mean zero and a standard deviation of 1. We then run regressions with the despair index as the dependent variable, test how the number of social associations in a county affects the level of despair. We find that counties with higher social associations per capita have a lower level of despair, numerically, we find that a one standard deviation increase of associations per 10,000 people reduces the despair variable by 0.14-0.2 points. This result remains robust under different specifications of the model. We explain this relationship by saying that social associations allow more interactions with other individuals, and less need to indulge in self-destructive activities, which in turn reduces the level of despair in the county.