Community economic structure and individual well-being: a look behind the statistics

Abstract

This paper presents a model of the community economic development process with an emphasis on its implications for individual well-being. It is intended as a social epidemiology which can help explain empirical findings demonstrating a connection between indicators of individual and social dysfunction and indicators of economic change. The model is one of economic development in a market-oriented, profit-maximizing society. The underlying hypothesis is that changes in economic activity brought about by increases in the size of firms and scale of production place new demands upon local resources and labor markets. In response, families and social networks begin to change the ways they relate to individual members, changes that cause individuals to become more directly vulnerable to the stresses and strains generated by economic activity. The result is that dysfunction, as manifest in the incidence and prevalence of various pathologies, increases with both ups and downs in the economy. The paper discusses the ways in which these changes become manifest in the statistical series used for purposes of empirical analysis and suggests the limits of this approach to social research. It ends by presenting a policy prescription for economic development which places emphasis on social cost minimization rather than output maximization.