How have retail sales patterns changed across rural America? A case study of Nebraska

This study investigates retailing activity and trends at different spatial scales for the last quarter of a century, from 1990 to 2015, for Nebraska using data from the Nebraska Department of Revenue. The primary unit of measurement used to assess the retail strength was Pull Factor. The Pull Factor (PF), is widely used to identify and measure leakage and/or capture of retail trade across political boundaries as well as identifying trends over time. Retailing is an important sector of any economy at all geographic levels and is watched carefully as an indicator of overall economic performance. For 2015 total taxable retail sales for the state was over 23 billion nominal dollars (slightly more than 13 percent of State Gross Product) for Nebraska. Results showed that population was the single largest factor that affected retailing activity. An analysis of top retail performers based on population class showed that all but one town employing the tax shift implications, by levying a local sales tax under the Local Option Revenue Act (applicable to cities) or Nebraska Revenue Statue 13-319 to 13-325 (applicable to counties), associated with their being trade-capture municipalities. This study also found that the higher (lower) the purchase index for motor vehicles, the lower (higher) the county retail pull factor for other taxable sales activity. This was because on average rural county residents spent relatively more on motor vehicle purchases than their metropolitan county cousins, which left less disposable income for other retail activity given no drastic differences in median household income levels across the state.