NCPA - National Center for Policy Analysis

State Economic Competitive Index

June 27, 2011

In the fourth edition of Rich States, Poor States, Arthur B. Laffer, Stephen Moore and Jonathan Williams discuss the best practices to enable states to drive economic growth, create jobs and improve the standard of living for their citizens.  The authors also provide the 2011 American Legislative Exchange Council (ALEC)-Laffer State Economic Competitiveness Index, based on states' economic policies.  Through the empirical evidence and analysis, readers can discover which policies lead to state economic growth and which policies states should avoid, says ALEC.

  • In chapter one, the authors examine the states' fiscal conditions and discuss the new possibilities for future fiscal reforms.
  • Chapter two surveys recent initiatives for fiscal reform in 2010.
  • In chapter three, a simple roadmap for regaining state prosperity highlights the policies best suited for creating jobs and sparking economic growth.
  • Chapter four provides the 2011 ALEC-Laffer State Economic Competitiveness Index, which gives two distinctive rankings for each state: the Economic Performance Rank (this ranking details states' individual performances over the past 10 years based on the economic data) and the Economic Outlook Rank (a forecast based on a state's current standing in 15 policy variables).

In this year's edition, the top 10 states on economic performance were (from one to 10, in order): Utah, South Dakota, Virginia, Wyoming, Idaho, Colorado, North Dakota, Tennessee, Missouri and Florida.  Rounding out the bottom of the list were: Pennsylvania, Rhode Island, Oregon, Illinois, New Jersey, Hawaii, California, Maine, Vermont and New York.

Source: Arthur B. Laffer, Stephen Moore and Jonathan Williams, "Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index," American Legislative Exchange Council, June 2011.


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