AN ANOMALY IN THE NORTHEAST:

Study Ranks States by Economic Freedom: Kansas, Colorado, and Virginia rank best on PRI Economic Freedom Index (John Skorburg, July 1, 2004, The Heartland Institue)

A new report issued by the Pacific Research Institute for Public Policy (PRI) ranks Connecticut, California, and New York lowest in terms of "economic freedom"--how friendly or unfriendly state governments are toward free enterprise. Kansas, Colorado, and Virginia rank highest in the report, which was featured in Forbes magazine's May 2004 "Best Places" issue.

"Where should you locate new businesses and subsidiaries?" asked Lawrence J. McQuillan, director of business and economic studies at PRI, in an article for Forbes. "In states with the fewest regulatory body blocks and fiscal obstacles."

PRI, an independent nonprofit research organization based in San Francisco, teamed up with economists Ying Huang and Robert E. McCormick of Clemson University to create the "U.S. Economic Freedom Index."

"In coming up with our ratings we evaluated 143 variables for each state, using the most recent data," explained McQuillan. "This snapshot includes tax rates, state spending, occupational licensing, environmental regulations, income redistribution, right-to-work and prevailing-wage laws, tort laws, and the number of government agencies. These we grouped into five sectors--fiscal, regulatory, judicial, size of government, and social welfare.

"For each of the 143 variables we ranked states from 1 (most free) to 50 (least free), calculated an average sector ranking, and then weighted them to get an overall score," continued McQuillan. "Welfare, fiscal, and regulatory matters counted about equally; government size and judicial ratings counted for less."

The map is especially revealing.

Posted by Orrin Judd at July 21, 2004 3:44 PM