Exam I – Test ReviewWealthiest or “best” states- Connecticut, New Jersey, and Massachusetts“Worst” states- Mississippi, West Virginia, and ArkansasMurder- New Hampshire has the least- Louisiana has the mosto High murder rates in state across the entire bottom of the countryUnemployment rates- Lowest: Hawaii, Utah, Idaho, Nebraska, and Virginia (less than 3%)- Highest: MichiganEducating Children (population of school age)- High: Texas, Mississippi, Georgia, and Iowa- Low: Hawaii, West Virginia, Maine, Florida, and VermontQuality of Life- Best: New Hampshire, New Jersey, Minnesota, and Utah- Worst: Alabama, Arkansas, S. Caroline, Louisiana, and Mississippi- Texas: ranked 22nd and 27thBusiness Climate- Best: Virginia, Utah, N. Caroline, Georgia, Colorado, Idaho- Worst: Arkansas, Rhode Island, West Virginia, Mississippi, Maine, and Louisiana- Texas: ranked 1st and 9th *Utah is the only state ranked high for both quality of life and business climate*Arkansas, Mississippi, and Louisiana are ranked lowest for both quality of life and business climate- National laws are passed by Congresso Reflect nationwide preferences, values and morals- Nationwide standard: no matter where you live, the same law applies- Term limits have been enacted by 22 of the 23 states allowing citizens to pass lawso Typically 8 years- U.S. Term Limits v. Thorton (1995): Court declared state restrictions on who could run for Congress were unconstitutional- Supreme Court ruled that setting a national speed limit exceeded the powers granted to Congress by the Constitution- In the U.S., taxes provide the largest share of government revenueso Revenues available to a state legislature depend on its public’s ability to pay taxes; and can best be judged by the wealth of a state- State’s wealth is best measured by the wealth of its residents and their ability to pay higher taxes- Southern states tend to have lower costs of livingPersonal Income v. Personal Income Adjusted for the Cost of Living (graph)- TX, MO, OK are above the diagonal lineo Meaning: lower-than-average costs of living Adjusted income is greater than nominal income- CT, NJ, and Maine are below the diagonal lineo Meaning: higher-than-average costs of living Adjusted income is less than nominal income- (Southern/most interior Western states were in the lowest personal income category)Wealth Differences among the states*There is not a simple relationship between tax rates and revenues per capita- Wealthier states will receive more revenues per capita with lower tax rates than those of poorer states- Wealthy states are mainly industrial states- Poorer states lack large metropolitan areaso E.g. Boston, Chicago, Denver, or LA that have high-paying occupations*You can also determine the wealth of a state by looking at the percentage of the population living in poverty- High poverty in the Southo Only the South and Southwest have states that are both low in income and high in poverty Low per capital personal income rate High poverty- Mountain West and Great Plains states do not have high percentages of their publics living in poverty despite their low per capital personal income Low per capital personal income rate Low poverty rateEducation- Legislators see improving education as a way to make their state more competitive in attracting businesses with high-paying jobs- Businesses with a choice will go to states with better educated residents because they’ll be able to fill positions more readily- An educated population is generally a component of “best in business” measures- 20th century – measure of a state’s education was the percentage of residents with at least a high school diploma- South stands out as poorly educatedo *High school education map does not correspond well with the per capita income map Utah and Montana = high education levels, low per capita incomeso *College education does correspond well with per capita income map % of population with at least Bachelor’s degree: TX ranks middle- Regression line: provides the best fit for scatter plot elements- Correlation coefficient: gives us information about the direction and goodness of fit of the estimated regression lineo Range [-1.0 to +1.0]*Percentage with Bachelor’s Degrees and Per Capita Income - CT and W. Virginiao Strong positive (+1.0)- CT, W. Virginia, Wyoming, and Vermonto Strong positive (.64)- All stateso CT, W. Virginia, Wyoming = above regression lineo Vermont = below regression line (predicts lower per capita income with Bachelor’s degree)o Strong positive (.76) TX is above regression lineMetropolitan or Urban Living- The first industrialized states are still the most metropolitan- Least metropolitan = traditional belt running in the Southo Exceptions: TX, FL, rural Midwestern states, and northern Mountain West and Plains states- Metropolitan Population and Per Capita Income (scatter plot)o Regression line: positive Higher percent metropolitan = higher per capita incomes- .44 – strong, positive- Murders and abortions are more common in heavily metropolitan areaso Strong positive relationship b/t larger metro populations and murder/abortion Percentage Metropolitan and Abortion- Strong positive (.67) Percentage Metropolitan and Murder- Positive (.35)- Mississippi and AR have high murder rates, low metropolitan- Massachusetts and CT have low murder rates, high metropolitanState Taxes and ExpendituresPer Capita Income and State and Local Taxeso Strong positiveo NY is an outlier (people from other states pay payroll tax if they work in NY)- State taxes are the largest single source of state revenues (41% in 2004)- **No relationship between per capita income and per capita nontax income- **Strong positive: per capita income and per capita total revenue- **Strong positive: per capital total revenue and local nontax revenue and total revenueo Wyoming and Alaska are outliers Benefitted from natural resources (petroleum, coal) in acquiring funds from the federal government- **Strong positive: total per capita state revenues and total per capita state expenditureso Alaska tops all stateso AR, MO, and OK have lowest (South)- **Strong positive: per capita state and local revenue and expenditureo Shows that states with higher revenues can afford higher expenditures Alaska, NY, WY, Massachusetts, CA, and CTo Suggests that they can provide a broad range of services Low: AR, MO, OKMinorities- 8/10 states for percentage of
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