(The Center Square) — According to a new study, most Michigan cities rank below the national average in a new Index of Economic Freedom.
The Mackinac Center for Public Policy published the study “Economic Freedom in the City: Ranking Michigan Labor Marketswhich classifies metropolitan areas into three broad policy areas: labor market regulation, taxation and public spending.
Midland received the highest overall freedom score in the state, while Ann Arbor and Grand Rapids-Wyoming also performed well.
The study uses data from 2017 to rank the country’s 383 metropolitan statistical areas based on level of economic freedom, consideration of taxes, government regulations, minimum wage burdens, size of bureaucracy, and the influence of trade unions.
Midland beat all other areas in the state, with an overall economic freedom score of 6.76 out of 10 – the only metropolitan area in the state that scored above the national average. Ann Arbor scored a 6.66 and Grand Rapids-Wyoming followed with a score of 6.56. Bay City, Flint, and Battle Creek were the worst performers among the state’s 14 MSAs, with scores of 5.62, 5.98, and 5.99, respectively.
“Economic freedom can vary widely from nation to nation and state to state, but it can also vary from local economy to local economy within states and across the country,” Study co-author Dean Stansel, associate research professor at the Bridwell Institute for Economic Freedom and adjunct scholar at the Mackinac Center, said in a statement. “Academics have produced hundreds of papers using similar national and state indices, generally concluding that greater economic freedom is associated with better outcomes on a wide variety of measures. This new index for metropolitan statistical areas has also allowed to extend the research to the local level.
The study indicates that there is a strong correlation between greater freedom and economic well-being. He argues that there are positive links between economic freedom and outcomes such as lower unemployment rates, higher employment, and population growth.
Nationally, Florida received eight of the top 10 scores.
“If lawmakers are to attract talent and keep people in the state, it’s critical to enact policies that benefit individuals and businesses,” said Michael LaFaive, MCPP’s senior director of tax policy and co- author of the study, in a press release. “Reducing unnecessary regulations and limiting tax burdens are just a few of the steps local and state policymakers can take to give individuals access to greater economic prosperity.”
Neither Grand Rapids nor Detroit — Michigan’s two large MSAs — ranked in the top or bottom 10 of the nation’s 52 largest MSAs for economic freedom. The Place du Center has already reported how the Motor City takes 77 steps and over $6,000 in fees to open a restaurant.