Rich States, Poor States

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Rich States, Poor States, 2014 Edition

By Arthur B. Laffer, Stephen Moore and Jonathan Williams

Throughout the country, states are looking for ways to energize their economies and become more competitive. Each state confronts this task with a set of policy decisions unique to their own situation, but not all state policies lead to economic prosperity.

Using years of economic data and empirical evidence from each state, the authors identify which policies can lead a state to economic prosperity. Rich States, Poor States not only identifies these policies but also makes sound research-based conclusions about which states are poised to achieve greater economic prosperity and those that are stuck on the path to a lackluster economy.

The 2014 economic outlook ranking is a forward-looking measure of how each state can expect to perform economically based on 15 policy areas that have proven, over time, to be the best determinants of economic success.

Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index is an annual economic competitiveness study authored by economist Dr. Arthur Laffer, Stephen Moore, chief economist at the Heritage Foundation, and Jonathan Williams, Director of the Tax and Fiscal Policy Task Force at the American Legislative Exchange Council.


2014 Economic Outlook Rank
  1. Utah
  2. South Dakota
  3. Indiana
  4. North Dakota
  5. Idaho
  6. North Carolina
  7. Arizona
  8. Nevada
  9. Georgia
  10. Wyoming
  11. Virginia
  12. Michigan
  13. Texas
  14. Mississippi
  15. Kansas
  16. Florida
  17. Wisconsin
  18. Alaska
  19. Tennessee
  20. Alabama
  21. Oklahoma
  22. Colorado
  23. Ohio
  24. Missouri
  25. Iowa
  26. Arkansas
  27. Delaware
  28. Massachusetts
  29. Louisiana
  30. West Virginia
  31. South Carolina
  32. New Hampshire
  33. Pennsylvania
  34. Maryland
  35. Nebraska
  36. Hawaii
  37. New Mexico
  38. Washington
  39. Kentucky
  40. Maine
  41. Rhode Island
  42. Oregon
  43. Montana
  44. Connecticut
  45. New Jersey
  46. Minnesota
  47. California
  48. Illinois
  49. Vermont
  50. New York
Economic Performance Rank
  1. Texas
  2. Utah
  3. Wyoming
  4. North Dakota
  5. Montana
  6. Washington
  7. Nevada
  8. Arizona
  9. Oklahoma
  10. Idaho
  11. Alaska
  12. North Carolina
  13. Oregon
  14. Virginia
  15. South Dakota
  16. Colorado
  17. Hawaii
  18. West Virginia
  19. Florida
  20. Nebraska
  21. Arkansas
  22. South Carolina
  23. New Mexico
  24. Iowa
  25. Tennessee
  26. Delaware
  27. Georgia
  28. Kentucky
  29. Louisiana
  30. Alabama
  31. Maryland
  32. Kansas
  33. Minnesota
  34. New Hampshire
  35. New York
  36. Vermont
  37. Pennsylvania
  38. Indiana
  39. Mississippi
  40. Missouri
  41. Massachusetts
  42. Maine
  43. California
  44. Wisconsin
  45. Connecticut
  46. Illinois
  47. Rhode Island
  48. New Jersey
  49. Ohio
  50. Michigan

Historical Rich States, Poor States

6th Edition | 5th Edition | 4th Edition

What Others Are Saying:

“Fostering a pro-growth tax and fiscal policy environment depends on principles like those championed in Rich States, Poor States.”

-Governor Pat McCrory, North Carolina Tweet this quote

“For years now, policymakers across our nation have looked to Rich States, Poor States as an essential guide to evaluate how their state ranks in economic competitiveness and job creation. We have taken this message to heart by significantly reducing taxes and working to ensure that hard working Iowans keep more of what they earn. This publication is a fantastic resource for state policymakers interested in creating more economic opportunity and enhancing the level of well-being for the citizens of their state.”

-Majority Leader Linda Upmeyer, Iowa; ALEC 2014 National Chair Tweet this quote

“A society based on true fairness is one that creates opportunity for everyone. Rich States, Poor States highlights the states whose public policies best empower citizens to earn their own success.”

-Arthur C. Brooks, President, American Enterprise Institute Tweet this quote

“Pro-growth tax and fiscal policies outlined in Rich States, Poor States help to foster an environment full of opportunities for taxpayers across our nation. In my home state of Washington, we do not tax individual income, which enables greater opportunities for entrepreneurs to start their own businesses, and gives taxpayers greater opportunity to provide for their own families. Anyone interested in bringing economic success to their own state will benefit from this publication.”

-Congresswoman Cathy McMorris Rodgers, Washington Tweet this quote

“Over the past few years, Kansas has taken up the task of fundamentally improving our tax code. As reflected in the most recent edition of Rich States, Poor States, the ALEC-Laffer State Economic Competitiveness Index, the results of this overhaul have been excellent, with record new business startups and falling unemployment, Kansas is more economically competitive than ever. In my view, the high-quality research undertaken throughout the seven editions of Rich States, Poor States has done more to promote state economic growth and competitiveness than any other publication of its kind.”

-Speaker Ray Merrick, Kansas Tweet this quote

“The evidence is clear: Economic prosperity is attainable for those states that exercise discretion and discipline in spending and taxation. Pro-growth tax and fiscal policies—like those championed by ALEC and throughout Rich States, Poor States—set a clear path to a renewed national economic recovery.”

-Governor Rick Perry, Texas Tweet this quote

“I am pleased to see Rich States, Poor States in its 6th edition. This edition, like its predecessors, reviews fiscal policies that contribute to economic growth compared to policies that detract from such growth. It has become a go-to source for state policymakers”

-Governor Matthew Mead, Wyoming Tweet this quote

“As Justice Brandeis noted, one of the happy aspects of the federal system is that a state may serve as a laboratory and try novel policy experiments. In 2012, the ‘Texas Experiment’ of light taxation and regulation produced more jobs than any state, and an economy growing at twice the national state average. Anyone interested in bringing similar success to their state should read this book.”

-U.S. Senator Ted Cruz, Texas Tweet this quote

“I want to thank the authors of Rich States, Poor States and ALEC for providing policymakers and the public with this valuable resource. There is no question that states like Utah are reaping the benefits of sound fiscal policy. It is clear that limited regulation, low taxes, low debt, and balanced budgets create the best environment for business, investment, and jobs.”

-Senate President Wayne Niederhauser, Utah Tweet this quote

“It is important for policymakers to have a publication that helps and encourages economic growth and competition between states to encourage economic prosperity. Publications like this one help educate legislators and governors with the tools to understand which policies work and which policies waste taxpayer dollars. The end goal for politicians should be the promotion of liberty, free markets, low taxation, and smaller government.”

-U.S. Senator Rand Paul, Kentucky Tweet this quote

“Most state legislatures across the country are focused on reducing spending, lowering taxes, and growing their economies. Rich States, Poor States continues to generate in-depth policy information that is critical to making decisions that will move states in a more economically sustainable direction. This publication is an important tool for policymakers, and I find it essential in understanding what makes each state competitive in a global economy.”

-Speaker Thom Tillis, North Carolina Tweet this quote


Rich States, Poor States 2014 Edition from American Legislative Exchange Council (ALEC)