AUSTIN—Texas ranks second out of all 50 states in this year’s Economic Freedom of North America report, released by the Texas Public Policy Foundation in conjunction with Canada’s Fraser Institute.

“Texas continues to be a leader in economic growth, job creation, and migration from other states,” said Dr. Vance Ginn, director of the Center for Economic Prosperity at the Texas Public Policy Foundation. “Texas’ high ranking reflects an environment conducive for individuals to flourish. While these stats indicate a supportive foundation for growth, improvements are necessary to sustain this success by continuing to pass conservative budgets, eliminating property taxes, and providing more opportunities for workers to prosper.”

For the third year in a row, New Hampshire, the Live Free or Die state, has the highest level of economic freedom among all U.S. states. It scored 8.3 out of 10 in this year’s report, which measures government spending, taxation and labor market restrictions using data from 2015, the most recent year of available comparable data.

“The freest economies operate with comparatively less government interference, relying more on personal choice and markets to decide what’s produced, how it’s produced and how much is produced. As government imposes restrictions on these choices, there’s less economic freedom and less opportunity for prosperity,” said Fred McMahon, the Dr. Michael A. Walker Research Chair in Economic Freedom at the Fraser Institute and report co-author.

Joining New Hampshire and Texas in the top five are Florida (tied with Texas for second), South Dakota (4) and Tennessee (5). For the third year in a row, New York was ranked least free (50), followed by California (49), New Mexico and West Virginia (tied for 47), and Hawaii and Mississippi (tied for 45).

In the most-free states, the average per capita income in 2015 was seven percent above the national average compared to roughly five percent below the national average in the least-free states.

“The link between economic freedom and prosperity is clear—people who live in states that support comparatively low taxation, limited government and flexible labor markets have higher living standards and greater economic opportunity,” said Dean Stansel, economics professor at Southern Methodist University and co-author of the report.

The Economic Freedom of North America report, also co-authored by José Torra, the head of research at the Mexico City-based Caminos de la Libertad, is an offshoot of the Fraser Institute’s Economic Freedom of the World index, the result of more than a quarter-century of work by more than 60 scholars, including three Nobel laureates.

See the full report at fraserinstitute.org and fraserinstitute.org/economic-freedom.

For more information or to request an interview with Dr. Ginn, please contact Alicia Pierce at apierce@texaspolicy.com or 512-472-2700.

About the Economic Freedom Index
Economic Freedom of North America (EFNA) measures the degree to which the policies and institutions of states/provinces support economic freedom. This year’s publication ranks 92 provincial/state governments in Canada, the United States and Mexico. The report also updates data in earlier reports in instances where data has been revised.

The Texas Public Policy Foundation is a non-profit free-market research institute based in Austin. The Texas Public Policy Foundation aims to advance a societal framework that effectively fosters human flourishing based upon cooperation and mutually beneficial exchange of ideas and speech.

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