Bryan Caplan  

Where's the State of the Free?

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In Montreal, I met William Ruger and Jason Sorens, creators of the Freedom in the 50 States index.  It's a neat project, no doubt partly driven by Sorens' leading role in the Free State Project.  Competing indices exist, but the Ruger-Sorens measure has much in its favor:
This study improves on prior attempts to score economic freedom for American states in three primary ways: (1) it includes measures of social and personal freedoms such as peaceable citizens' rights to educate their own children, own and carry firearms, and be free from unreasonable search and seizure; (2) it includes far more variables, even on economic policies alone, than prior studies, and there are no missing data on any variable; and (3) it uses new, more accurate measurements of key variables, particularly state fiscal policies.
The index separately reports fiscal and regulatory policy, then averages these scores to get an overall measure of economic freedom.  It separately measures personal freedom, then averages economic and personal freedom to measure a state's overall freedom.  Thus, the overall freedom measure is by definition 25% fiscal policy, 25% regulatory, and 50% personal.

Economically, the freest states turn out to be South Dakota, New Hampshire, and Colorado; the least free are California, Maine, and last of all, New York.  Personally, the freest states are Alaska, Maine, and New Mexico, and the least free are New York, Illinois, and Maryland.  My home state of Virginia ranks 13th in economic freedom and 9th in personal freedom.

Finally, according to Ruger-Sorens' overall scores, the freest states in the union are New Hampshire, Colorado, and South Dakota, and the least free are Rhode Island, New Jersey, and New York.

Overall, it's an impressive set of results.  Given the intranational mobility of labor and capital - and the ability of real estate prices to adjust - I wonder how predictive their measures will be for things like economic growth and migration.  I also suspect that states like New York and California mask the social benefits of freer policies.  Due to their big non-policy perks - focal location for New York, great weather for California - they feel like they can get away with less economic freedom - and they're not entirely mistaken. 

Still, if I wanted to really put South Dakota on the map, I can't think of any better strategy than making it even more abnormally free.  Imagine a world where would-be immigrants told each other, "One day, I'll be living in South Dakota - the state of the free in the land of the free."

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COMMENTS (8 to date)
John Thacker writes:

It's impressive that Maryland scores so badly in the personal freedom score, especially considering that Maryland is pretty good about having privatized liquor compared to around half the states.

fructose writes:

It is notable that California, New York, and Maine are all states that have been badly hurting economically.

wintercow20 writes:

Indeed Bryan. Our home city of Rochester, NY (one of those decaying old industrial cities) could do no better than to open up the city limits to "illegal" immigrants of all kinds, granting them amnesty to live, work and play so long as they remain here.

As a resident of South Dakota, I can attest to SD being awesome. We have a low unemployment rate and a low poverty rate (when discluding the Indian Reservations), a highway speed of 75 mph (de facto 80 mph), the lowest murder rate in the nation, and no income tax. The 2001 recession did not even faze us. Life here is free and great.

I live in Sioux Falls, with more restaurants per capita than anywhere in the US, 3rd cleanest public drinking waters in the nation, unemployment at around 5%, a low crime rate, the safest drivers in the nation, and cutting edge medical facilities. Citibank is headquartered here. Forbes magazine has named Sioux Falls “Best Small Place For Business And Careers” for 6 years in a row.

Floccina writes:

I am from Providence RI and now live in Florida and before I read down I was guessing that RI would near the top.

Brian Clendinen writes:

I really like it that they included private school regulation and homeschooling. To me limiting how I educate my child is one of the most significant breaches of personal freedoms.

Chris Koresko writes:

I find the scatter plots the most interesting part of the paper.

Figure 1 is a plot of personal vs economic freedom. As the authors put it:

"The common libertarian conception about the political spectrum is that left-liberals sit in the upper left corner of this diagram, favoring extensive personal freedom and little economic freedom, while right-conservatives belong in the bottom right corner, favoring ­ economic but not personal freedom. It should be clear from this chart that the truth is much different."

Indeed. In fact, the data seem to support my (conservative) prejudices better. I see two sets of points, one forming a vertical bar at -0.3 on the personal freedom index (wide range of economic freedom with low personal freedom) and the other forming an upward-sloping line (personal and economic freedom positively correlated). The latter is what I would have predicted.

The remaining plots show a pretty consistent more or less linear anticorrelation between the liberty metrics and Democratic voting.

Devil's Advocate writes:

Idaho's reputation for being a very free state was one of the things that attracted me to Boise. Add to that all of the recreational activities (ranked #1 place to live by Outside Magazine) and the beautiful scenery, and it has a lot to offer.

I was thinking the same thing as Bryan - that with the hundreds of thousands (if not millions) of Tea Party protesters/members demanding limited government and more freedom, some state should take the lead on providing just that. It could be the flipside of the Free State Project - instead of people moving there to change the government, change the government to get people to move there.

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