AN ECONOMIC IMPACT STUDY OF THE EFFECTS OF INTERSTATE 55 ON THE HIGHWAY-RELATED BUSINESSES IN FIVE NORTHERN MISSISSIPPI TOWNS

THE TOTAL SALES OF ALL EATING AND ALL LODGING PLACES AND THE TOTAL GALLONAGE OF ALL SERVICE STATIONS IN THE STUDY AREA INCREASED DURING EACH YEAR OF THE STUDY PERIOD FOR WHICH COMPLETE DATA WERE AVAILABLE. EACH YEARS RATE OF INCREASE EXCEEDED THE RATE APPLICABLE TO THE CONTROL AREA. THE AGGREGATE FIGURES DO CONCEAL SOME HARDSHIPS SUFFERED BY MARGINAL FIRMS. RESTAURANTS ON HIGHWAY 51 LOST THEIR LOCATIONAL ADVANTAGE ONCE I-55 OPENED AND UNLESS THEY WERE ABLE TO ATTRACT AND HOLD A HIGH PERCENTAGE OF LOCAL BUSINESS, THEY SUFFERED SHARP LOSSES. MOST OF THE MOTEL AND CAFE BUSINESS WAS ACCOUNTED FOR BY A SMALL NUMBER OF LARGER- SIZED FIRMS. AN UNMISTAKABLE TREND IS THE DEVELOPMENT OF NEW SERVICE STATIONS, CAFES AND MOTELS IN THE STUDY AREA TOWNS NOT ON HIGHWAY 51 BUT NEAR INTERSTATE 55. THE ESTABLISHMENT OF A BUSINESS IN THIS NEW LOCATION PREVENTED THE AGGREGATE GALLONAGE FIGURES IN THE STUDY AREA FROM DECLINING AFTER THE INTERSTATE OPENED SINCE THE VAST MAJORITY OF THE OLDER SERVICE STATIONS SUFFERED LOSSES OF GALLONAGE THE FIRST YEAR AFTER THE NEW HIGHWAY WAS COMPLETED. SERVICE STATIONS HAD A GREATER AMOUNT OF MANAGEMENT TURNOVER THAN CAFES AND MOTELS. THE RESEARCHER FOUND THAT THE CAPITAL REQUIREMENTS ARE NORMALLY LOWER FOR SERVICE STATIONS AND, THEREFORE, THE STATION OPERATORS ARE MOST APT TO SHUT DOWN THEIR BUSINESSES IF A BETTER JOB OPPORTUNITY PRESENTS ITSELF. CONVERSELY, MOTEL AND RESTAURANT OWNERS USUALLY HAVE TOO MUCH OF THEIR SAVINGS INVESTED IN THEIR BUSINESSES TO SHUT THEM DOWN WHEN SALES DECLINE, AND SINCE SUCH BUSINESSES ARE VIRTUALLY IMPOSSIBLE TO SELL, THE OWNERS HAVE NO ALTERNATIVE BUT TO CONTINUE OPERATING THEM. /AUTHOR/

  • Supplemental Notes:
    • Hpr-1121, STATE 6
  • Corporate Authors:

    University of Mississippi, University

    P.O. Box 1848
    University, MS  United States  38677

    Mississippi State Highway Department

    P.O. Box 1850
    Jackson, MI  United States  39215

    Bureau of Public Roads /US

    400 7th Street, SW
    Washington, DC  United States  20590
  • Authors:
    • Wells, D R
  • Publication Date: 1967-6-30

Subject/Index Terms

Filing Info

  • Accession Number: 00201183
  • Record Type: Publication
  • Source Agency: Bureau of Public Roads /US
  • Files: TRIS, STATEDOT
  • Created Date: Sep 15 1994 12:00AM