Employment, state GDP, labor-law and tax data from 2000 to the present yield two strong lessons. First, a business-friendly climate—market-oriented labor policies and lower taxes—is effective in raising the growth in a state’s gross domestic product and employment. Second, states that suffered the worst employment shocks in the 2007-09 recession had the most rapid postrecession employment growth. This suggests that the weak national recovery cannot be explained by the depth of the recession.
View Article