“De Dorpstraat, die is van mij! Small cities and large towns along the Continental littoral"

Abstract

How are macroeconomic measures affected by local geography, housing and education? This study tests regional purchase parity data as a dependent variable subject to location, housing prices and estimations of post-secondary education. Limiting the set of inquiry to small cities along the Continental European littoral, the results of a robust regression show that Purchase Power Standards (PPS) at the regional level are modestly impacted by changes in the index of stand-alone housing prices, the level of tertiary education and the distance of a small city to a metropolitan statistical area of more than one hundred thousand people. Among the salient policy implications derived from these facts, the paper recommends tempering the faith invested in the creation of local educational institutions and urges a reassessment of the value placed upon the regenerative potential of new, stand-alone, housing development. The conclusion suggests utilizing city-level administrative budget data, regional retail microdata and tourist demographics will enhance further research.