Fracking Fortunes: Economic Well‐being and Oil and Gas Development along the Urban‐Rural Continuum

Oil and gas extraction, especially via unconventional means like hydraulic fracturing, is hailed as an economic boon by many commentators and political leaders. However, empirical evidence is limited. In this article, we consider the socioeconomic effects (particularly, related to poverty, employment, income, and wages) of unconventional oil and gas extraction using a national data set of U.S. counties. We use a novel between‐ and within‐county random effects modeling strategy to capture both resource curse and boomtown dynamics. Further, we allow the effect of oil and gas development to be conditioned by county rurality. Broadly, our findings suggest that oil and gas development has very complex effects at the county level. Within‐county growth in oil and gas production slightly improves most economic outcomes, but counties that specialize in oil and gas development tend to perform worse than other counties. We find that, in general, the effect of within‐county oil and gas production is not significantly moderated by county rurality.