California ranks 48th among the states on economic freedom, according to Freedom in the 50 States, a biennial study by Mercatus Center at George Mason University.
The Arlington, Va., center studies how markets work and tends to favor lower taxes and government regulation but also same-sex civil unions and marijuana decriminalization. Its study rates each state on 21 different issues with separate rankings for fiscal policy, regulatory policy, economic freedom and personal freedom. (Click on the map below for a larger view.)
This study says it attempts to measure “the extent to which state and local public policies conform to this ideal regime of maximum, equal individual freedom.”
Such policies matter, the study says, because “Americans are voting with their feet and moving to states with more economic and personal freedom and that economic freedom correlates with income growth.”
California doesn’t do well by any of the study’s measures: 48th on economic freedom and overall ranking, 47th on fiscal policy and regulatory policy and 41st on personal freedom (pluses for marijuana and same-sex partnership laws; minuses for nation’s most restrictive gun laws).
“Contrary to popular perception, California not only taxes and regulates its economy more than most other states, it also aggressively interferes in the personal lives of its citizens,” the study says. “California simply needs to cut government spending.”
On economic freedom, Alaska is worse than California and New York is worst of all. In fact, New York is dead last on the overall ranking and fiscal policy too.
The economically freest states, according to this study:
South Dakota (second in overall ranking)
New Hampshire (first overall)
North Dakota
Idaho
Virginia
California didn’t rate highly in the past, but its economic and personal freedom declined the most in the past two years, tied with Wyoming because of state financial woes, while Oregon has gained the most freedom because of changes in its court system and tax cuts.
The center says it aims the report not merely at state legislators who set state policies, but businesses considering where to expand or make new investments and individuals planning were to move or retire.
Click here to read the entire study.
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