This research note examines the related subjects of cost of living and household income among North Carolina counties. More generally connected to regional economic wellbeing, we use these examples to illustrate both their relatedness and their geographic variability across the state. We ascribe some of these differences to the differential impacts of place and space. We do this in the context of regression models, placing special emphasis on the interpretation of spatial fixed effects as an indicator of “place” and spatial lags/errors as indicators of “space” or spatial interaction. Despite the close connection between income and cost of living, we contend that variation in income across North Carolina is best conceptualized as the result of a spatial process. Differences in cost of living, as captured by fixed effects, reflect place-based attributes and simple geographic variation in natural amenities. Directions for future research are offered.


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pp. 81-104
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