Economics of rural areas : Rural capital, capital immobility, and path dependence Public Deposited


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  • These remarks are in the nature of a sequel to an earlier paper with dis­cussions presented at the winter meetings of the American Economic Association and the American Agricultural Economics Association held in Chicago, January 1998. (Castle; also see discussions by Oakerson, Kraybill, Salamon, and Summers and Brown). In that paper it was concluded that rural capital stock is an important concept in rural decision making and in defining the field of rural studies. This conclusion is based on the factual proposition that rural people, under our system of government, have been accorded a degree of autonomy in the management of their affairs. This, in tum, rests on the normative judgment that some degree of autonomy is de­sirable. In that paper, four forms of capital--natural, man-made, human and social--were assumed to constitute the total stock of rural capital. The paper defined each component, and special attention was given to social capital. How is this autonomy, of whatever magnitude, to be exercised? What will be its concerns? We believe that the management of the total stock of rural capital is of fundamental importance in this respect. It is this stock that will place a limit on what can be accomplished in the present, and its man­ agement in the present will affect the future. Thus, in a very fundamental way, those group decisions accorded to rural people will be concerned with the creation, management, and maintenance of various forms of rural capital. Clearly, both public and private rights are held in varying proportions in the various capital forms, yet all privately held capital exists in an institu­tional context reflecting public or group considerations. It is those group decisions which affect the rural capital stock in some way that constitutes the essence of rural studies.
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