The Best States for Business when it comes to Regulations


The Pacific Research Institute (PRI) a non-partisan, non-profit think tank based in San Francisco, today released the “The 50-State Index of Small Business Regulation,” a comparison of the regulatory burdens of small businesses across the 50 states. The Index was developed by PRI senior fellow Wayne Winegarden, Ph.D. Texas ranked the best state for small businesses, while New Jersey ranks the worst. The top 10 and bottom states  are:

Top  States
1.  Texas
2.  Indiana
3.  Mississippi
4. North  Dakota
5.  Georgia
6.  Florida
7.  Missouri
8.  Alabama/South Carolina
10.  Oklahoma

Bottom  States
40. New  Hampshire
41.  Hawaii
42.  Oregon
43.  Washington
44. New  York
45.  California
46.  Maine
47.  Connecticut
48. Rhode  Island
49.  Vermont
50. New  Jersey

“The purpose of the Small Business Index is to create a benchmark that allows the comparison of regulatory burdens and to provide insights on how each state can enact pro-growth reforms,” said Dr. Winegarden. The Index measures 14 regulatory components that are either positively or negatively associated with small business economic burdens and relates these burdens to the growth performance of small businesses across the  states.

All ten of the lowest ranked states scored poorly across most of the 14 regulatory components measured in the Index. A significant improvement to their regulatory environments would require broad-based reforms including: right-to-work; reduced family leave mandates; the elimination of energy policies such as those that subsidize politically favored energy resources and increase the costs of electricity and other forms of energy; lessening the costs (and time) to develop and license real estate; and reigning in excessive workers compensation and unemployment insurance  mandates.

“During the last decade, small businesses’ share of the nation’s GDP has been decreasing while employment in small businesses has been lagging larger businesses. Due to their role as innovators and job creators, it’s vital to re-invigorate America’s small businesses,” said Dr.  Winegarden.


About the Pacific Research Institute:
For 35 years, the Pacific Research Institute (PRI) has championed freedom, opportunity, and individual responsibility through free-market policy solutions. PRI is a non-profit, non-partisan organization. For more information, please visit our web site at

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