Saturday, February 16, 2019

Americans are moving to cities with more economic freedom which have more prosperity

See Why Do Some Local Economies Thrive While Others Struggle? Liberals Won't Like The Answer by Dean Stansel. Excerpt:
"While economic freedom varies across states within the U.S., it also varies within states, as my new study published by the Reason Foundation shows.

The "U.S. Metropolitan Area Economic Freedom Index" uses nine different measures of state and local government policies to produce an overall score for each of the nation's 382 metropolitan statistical areas (MSAs). For purposes of rankings, the 52 largest with over a million residents were examined separately.

In California, for example, San Jose, home to many of the tech companies in Silicon Valley, ranked in the middle of the pack (at 27th), but Los Angeles ranked in the bottom 10 and Riverside ranked last (52nd).

Similarly, in Tennessee, Nashville scored well, ranking as the 6th most free metro area, but Memphis was only 20th.

This variation within states helps explain why some areas within a state can thrive while others struggle.

From 2012 to 2016, San Jose's metro area population grew by 4.4%, while Los Angeles' grew less than half as fast (2.1%).

Nashville's population grew by 8% while Memphis' barely budged (0.2%).

Overall, the five most-free large areas were Houston, Jacksonville, Tampa-St. Petersburg, Richmond, and Dallas-Fort Worth. The bottom five were Riverside, Calif.; Rochester, Buffalo and New York City in New York state, and Cleveland.

The study shows that population grew four times faster in the freest areas. The most-free areas were also more prosperous, with per-capita personal income 5.7% above the metro area average, while the least free were 4.9% below average.

That means per capita income was nearly 11% higher in the freest areas. (See nearby chart.)
The positive relationship between economic freedom and economic prosperity at the local level is similar to findings at the state and country levels.

Over 200 articles by independent researchers have examined this relationship at the state level using the Fraser Institute's annual Economic Freedom of North America report.

In one recent study, economists at West Virginia University and Louisiana State University found that a 10% increase in economic freedom was associated with a 5% increase in real per capita gross state product (a measure of the total output of the economy per person).

At the local level, researchers have found that metro areas with higher economic freedom tend to have greater net in-migration of population, more entrepreneurial activity, higher levels and faster growth of per capita income, faster population growth, higher female labor force participation rates, and better local government bond ratings."

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.