There is a group that does study for almost anything that you could dream of – our fascination with numbers and rankings is just incredible. In this case, a ranking of how economically free each State in the US. The group that produced this report “U.S. Economic Freedom Index 2008” was the Pacific Research Institute,
Here is it’s definition of “economic freedom”:
Economic freedom is the right of individuals to pursue their interests through voluntary exchange of private property under a rule of law. This freedom forms the foundation of market economies. Subject to a minimal level of government to provide safety and a stable legal foundation, legislative or judicial acts that inhibit this right reduce economic freedom. Government acts that advance this right increase economic freedom. This report focuses on state and local government actions as they relate to economic freedom; we do not judge the wisdom, merit, or purpose of specific government programs.
We gathered data on 143 indicators per state (data set 1, listed in appendix A). This snapshot included tax rates, state spending, occupational licensing, environmental regulations, income redistribution, right-to-work and prevailing-wage laws, and tort reform, to name just a few. Next, we cut some redundant indicators and averaged similar indicators for compactness (appendix B explains this process). This data parsing resulted in five different data sets (data sets 1–5).
The final weighted score was computed with the following equation:
The sector-score weights used to compute the final 2008 index score for each state were: Index = (0.2313 × Fiscal Score) + (0.2159 × Regulatory Score) + (0.1894 × Judicial Score) + (0.1208 × Government-Size Score) + (0.2426 × Welfare-Spending Score)
Rest after the jump.