- The overall freedom ranking is determined by combining scores for fiscal, regulatory, and personal freedom.
The fiscal policy dimension consists of the following categories: Tax Burden (28.6%), Government Employment (2.8%), Government Spending (1.9%), Government Debt (1.2%), and Fiscal Decentralization (0.9%).
The regulatory policy dimension consists of the following categories: Freedom from Tort Abuse (11.5%), Property Right Protection (7.6%), Health Insurance Freedom (5.4%), Labor Market Freedom (3.8%), Occupational Licensing Freedom (1.7%), Miscellaneous Regulatory Freedom (1.3%), and Cable and Telecom Freedom (0.8%).
Personal freedom dimension consists of the following categories: Victimless Crime Freedom (9.8%), Gun Control Freedom (6.6%), Tobacco Freedom (4.1%), Alcohol Freedom (2.8%), Marriage Freedom (2.1%), Marijuana and Salvia Freedom (2.1%), Gambling Freedom (2.0%), Education Policy (1.9%), Civil Liberties (0.6%), Travel Freedom (0.5%), Asset Forfeiture Freedom (0.1%), and Campaign Finance Freedom (0.02%).
- Economic Freedom
- Economic freedom is calculated as the sum of the fiscal and regulatory policy indices.
- Freedom from Tort Abuse
- The liability system is a ranking of state tort systems based on a survey of business owners and managers. This is what the US Chamber of Commerce calls a state’s “lawsuit climate.” It captures risks and costs that businesses must pass on to consumers as higher prices.
- The category contains the following variables: Ranking of state liability systems
- Property Right Protection
- The property rights category includes eminent domain reform and land-use regulations. Almost all its weight comes from two variables: local rent control laws and an index of residential land-use regulations. The remainder takes into account whether compensation or an economic assessment is required before a regulatory taking, an index of eminent domain reform, and whether free speech is mandated on private property.
- The category contains the following variables: Local rent control, Regulatory taking restrictions, Mandated free speech on private property, Wharton Residential Land Use, and Eminent domain index.
- Health Insurance Freedom
- Health insurance includes state-level health insurance mandates, small group rate review, guaranteed issue regulations, individual market community rating, mandated direct access to providers, individual market rate review, and a host of lower-impact regulations on managed care organizations (HMOs). State-level health insurance mandates, the second most significant variable in this category at 1.7 percent of the freedom index, impose direct costs of nearly $9 billion a year.
- The category contains the following variables: Financial incentives to providers banned, COBRA continuation : small firms, Group conversion rating limits, Group conversion coverage : small firms, Individual policies: elimination riders banned, Individual health insurance mandate, Individual guaranteed issue, Community rating: individuals, Individual rate review, Mandated external grievance review, “Mandate-free” or “mandate-light” policies, Health insurance mandates index, Direct access to specialists mandated, Community rating: small groups, Small group rate review, and Standing referrals mandated.
- Labor Market Freedom
- Right-to-work laws make up more than half of the labor regulation category and nearly 2 percent of the entire freedom index. They are valued at over $10 billion a year. Other policy variables in this category, in descending order of importance, are short-term disability insurance requirements (costs being lower labor productivity and administrative expenses for businesses), policies dealing with workers’ compensation (funding mechanisms and mandated coverages), state minimum wage laws (figures adjusted for median private wages), requirements for employer verification of legal resident status, mandated paid family leave, and regulations prohibiting discrimination in employment (or employer-provided insurance) between smokers and non-smokers.
- The category contains the following variables: Workers' comp coverage regulations, Workers' comp funding regulations, Short-term disability insurance, Paid family leave, Minimum wage, Right-to-work, Employer verification of legal status, and Smoker protection laws.
- Occupational Licensing Freedom
- Almost two-thirds of the occupational freedom category’s weight is made up of two variables: a measure of occupational licensing extent and the sum total of education and experience requirements for all included occupations. Rounding out the category are regulations that limit the practice of nurses and nurse practitioners, physician assistants, and dental hygienists.
- The category contains the following variables: Dental hygienist independent practice, Education and experience requirements, Employment-weighted licensure, Exam requirements, Fees for licensed occupations, Nurse licensure compact membership, Nurse practitioner independent practice, and Physician assistant prescribing authority.
- Miscellaneous Regulatory Freedom
- Miscellaneous regulations include certificate of need (CON) requirements for hospitals, state auto insurance rate filing requirements, state homeowners’ insurance rate filing requirements, membership in the Interstate Insurance Product Regulation Compact, and state rate classification prohibitions for some classes of insurance. CON regulations land their first-place slot based on the over $3 billion in extra costs they impose on hospitals, customers, and potential market entrants.
- The category contains the following variables: Certificate of need for hospitals, Rate filing requirements: homeowners' insurance, Interstate insurance product regulations compact, Rate filing requirements: personal auto insurance, and Rate classification prohibitions.
- Cable and Telecom Freedom
- Telecommunications deregulation accounts for roughly two-thirds of the weight for this category, and the remainder is accounted for by statewide cable franchising, which eases the entry of telecom firms into the video cable market. Telecommunications deregulation accounts for roughly two-thirds of the weight for this category, and the remainder is accounted for by statewide cable franchising, which eases the entry of telecom firms into the video cable market.
- The category contains the following variables: Statewide cable franchising, and Telecom deregulation.
- Victimless Crime Freedom
- The most heavily weighted category in the personal freedom dimension—after direct victim costs have been calculated and constitutional factors taken into account—is the law enforcement statistics category, which consists of data on incarceration rates adjusted for violent and property crime rates, non-drug victimless crimes arrests, and the drug enforcement rate. This category is worth over one-quarter of the personal freedom index.
- The category contains the following variables: Arrests for non-drug victimless crimes: % of all arrests, Drug enforcement rate, Crime rate-adjusted incarceration rate, and Arrests for non-drug victimless crimes: % of population.
- Gun Control Freedom
- Gun control measures the direct costs of gun laws to gun owners and dealers as evidenced in sales, price, and ownership figures, as well as original analysis about how concealed-carry restrictions and costs are associated with the number of people who seek permits in each state.
- The category contains the following variables: Gun control.
- Tobacco Freedom
- Tobacco freedom includes taxes on tobacco, smoking bans, Internet sales bans, and vending machine regulations. The freedom index also takes into account taxes paid by smokers, which are excluded from the taxation category used in the fiscal policy dimension, as well as the deadweight costs of the taxes.
- The category contains the following variables: Tobacco freedom.
- Alcohol Freedom
- Alcohol distribution system makes up 1.2 percent of the whole index on its own. Research shows that state distribution of alcohol imposes significant costs on consumers in time and inconvenience. Indeed, the hypothetical losses from nationwide state control of alcohol distribution have been estimated at about $20 billion. Beer, wine, and spirits taxes each make up about 0.4 percent of the index as a whole, followed by other minor alcohol regulations: blue laws, keg registration/bans, mandatory server training, and “happy hour” bans. Blue laws (bans on Sunday sales) would, if implemented nationwide, reduce consumer welfare by more than $4 billion.
- The category contains the following variables: Alcohol distribution, Beer taxes, Blue laws, Happy hour laws, Keg regulations, Spirit taxes, Mandatory server training, and Wine taxes.
- Marriage Freedom
- Almost all the weight of the marriage freedom category is tied to the availability of same-sex partnerships, both civil unions and marriage. The remainder is tied to waiting periods and blood test requirements. States that prohibit same-sex couples from entering private contracts that provide the benefits of marriage (whether termed “marriages” or “civil unions”) take away an important contract right from these couples.
- The category contains the following variables: Blood test requirement, Same-sex partnerships, and Total waiting period.
- Marijuana & Salvia Freedom
- This edition of Freedom in the 50 States uses a much more sophisticated index of medical marijuana policies than previous editions and combines this index with the other marijuana policy variables—decriminalization and legalization of the first offense of “low-level” marijuana possession, misdemeanor status for “high-level” possession or “low-level” cultivation or sale, mandatory minimum sentences for “low-level” cultivation or sale, the logarithm of the maximum possible prison term for a single marijuana offense—and using principal component analysis yields a sensible index of marijuana policies.
- The category contains the following variables: Marijuana, Salvia ban
- Gambling Freedom
- This category is dominated by an estimate of the loss to consumers because of gambling restrictions. The category also includes measures for whether social gaming is legal, whether “aggravated gambling” is a felony or misdemeanor, and whether there is an express ban on online gaming.
- The category contains the following variables: Gambling felony, Gaming revenues, Internet gaming prohibition, Social gaming exception
- Education Policy
- Within education policy, mandatory licensure of private school teachers appears to be the most destructive regulation, and it alone constitutes slightly more than half of the overall educational freedom weight. Other variables are years of mandatory schooling, extent of private school curriculum control, tax credits and deductions for private or home schools (for parents or as contributions to scholarship funds), mandatory government approval of new private schools, home school curriculum control, standardized testing or other evaluation requirements for home schools, extent of home school recordkeeping requirements, teacher qualifications for home schools, an index of home school notification requirements, mandatory kindergarten attendance, the existence of a statute explicitly permitting homeschooling, and mandatory registration of private schools.
- The category contains the following variables: Compulsory schooling years, Homeschooling curriculum control, Homeschooling law, Homeschooling notification requirements, Homeschooling recordkeeping requirements, Homeschooling standardized testing, Homeschooling teacher qualifications, Mandatory kindergarten, Private school approval required, Private school teacher licensure, Private school registration, Private school curriculum control, and Tax credit/deduction.
- Civil Liberties
- The civil liberties category is a grab bag of mostly unrelated policies, including raw milk laws, fireworks laws, prostitution laws, physician-assisted suicide laws, religious freedom restoration acts, rules on taking DNA samples from criminal suspects, trans-fat bans, and laws that can be used to prosecute people who audiorecord public officials in the performance of their duties.
- The category contains the following variables: DNA taken from arrestees, Fireworks laws, Physician-assisted suicide legal, Prostitution legal, Raw milk sales legal, Two-party consent for recording, Religious Freedom Restoration Act, and Trans-fat bans.
- Travel Freedom
- Seat belt laws and mandatory uninsured/underinsured motorist coverage are the two most important variables in the travel category, based on estimated costs in terms of tickets and uncompensated premiums to drivers who do not prefer to perform such activities. After that come motorcycle helmet laws, bicycle helmet laws, bans on driving while using a cell phone, open container laws, and sobriety checkpoints, in that order.
- The category contains the following variables: Uninsured/underinsured motorist insurance required, Seat belt enforcement, Bike helmet laws, Cell phone driving ban, Motorcycle helmet laws, Open container laws, and Sobriety checkpoints.
- Asset Forfeiture Freedom
- The calculation for the ease of civil asset forfeiture is based on results reported in the Institute for Justice study Policing for Profit. This index basically reflects the extent to which a state’s tight asset forfeiture rules encourage revenue-sharing with the Department of Justice. Tight rules are indeed better, since the government should not take private property simply because it was allegedly used in a crime or allegedly constitutes proceeds of a crime, unless the owner of the property is found culpable in a court of law and the seizure is used to compensate victims. But as the Institute for Justice study found, tight rules simply encourage forfeiture by the federal government.
- The category contains the following variables: Asset forfeiture rules.
- Campaign Finance Freedom
- The campaign finance policy category covers public financing of campaigns and contribution limits (individuals to candidates, individuals to parties, an index of individuals to PACs and PACs to candidates, and an index of individuals to PACs and PACs to parties). While these policies receive “constitutional weights” boosting them by a factor of 10 because of their First Amendment implications, they receive low weights even so because there is not much evidence that contribution limits reduce private actors’ involvement in politics, unless the limits are extremely low (and Vermont’s extremely low limits were struck down by the US Supreme Court in 2006).
- The category contains the following variables: Grassroots PAC contributions to candidates, Grassroots PAC contributions to parties, Individual contributions to candidates, Individual conributions to parties, and Public financing.
This section contains all the subcategories in the Freedom in the 50 States index.
- User-Created Categories
- Homeschooling Freedom
- This user-created category combines a variety of regulations on homeschools.
- The category contains the following variables: Homeschooling curriculum control, Homeschooling law, Homeschooling notification requirements, Homeschooling recordkeeping requirements, Homeschooling standardized testing, and Homeschooling teacher qualifications.
- Family Friendly Freedoms
- This user-created category combines policies that affect families, including those on taxes, marriage, schooling, jobs, housing, insurance, and telecom.
- The category contains the following categories and variables: Education Policy, Tax Burden, Marriage Freedom, Labor Market Freedom, Occupational Licensing Freedom, Health Insurance Freedom, Miscellaneous Regulatory Freedom, Cable and Telecom Freedom, Local rent control, Eminent domain index, Wharton Residential Land Use, and Regulatory taking restrictions.
- Bachelor Party Freedom
- This user-created category combines alcohol taxes, victimless crimes and rules governing happy hours, kegs, tobacco, marijuana, prostitution, fireworks, and open containers.
- The category contains the following categories and variables: Gambling Freedom, Victimless Crime Freedom, Tobacco Freedom, Beer taxes, Happy hour laws, Keg regulations, Spirit taxes, Wine taxes, Marijuana, Fireworks laws, Prostitution legal, and Open container laws.
- Finding a Job Freedom
- This user-created category combines the labor market and occupational freedom categories.
- The category contains the following categories: Labor Market Freedom and Occupational Licensing Freedom.
- Alcohol Tax Freedom
- This user-created category combines taxes on beer, wine, and spirits.
- The category contains the following variables: Beer Taxes, Spirit Taxes, and Wine Taxes.
- Freedom from Nanny Laws
- This user-created category combines laws designed to protect people from themselves, including helmet and seat belt laws, cell phone restrictions while driving, raw milk bans, trans-fat bans, and firework laws.
- The category contains the following variables: Seat belt enforcement, Bike helmet laws, Cell phone driving ban, Fireworks laws, Motorcycle helmet laws, Raw milk sales legal, and Trans-fat bans.
- Food Freedom
- This user-created category combines raw milk and trans-fat variables.
- The category contains the following variables: Raw milk sales legal and Trans-fat bans.
- Helmet Freedom
- This user-created category combines bicycle and motorcycle helmet laws.
- The category contains the following variables: Bike helmet laws and Motorcycle helmet laws.
This section contains groupings of variables that are not directly captured as subcategories in the ranking but are of interest.
- Government Debt
- The victim cost for state and local government debt as a share of the state's personal income. The index considers the victims of government debt to be the next generation of taxpayers, 20 years hence.
- Fiscal Decentralization
- Measures the extent to which a state is more fiscally decentralized than one would expect given its size.
- Government Employment
- Estimate of the crowding-out effects of government employment on the private sector.
- Tax Burden
- Each state's tax burden is measured by calculating state and local tax revenues as a percentage of the state's personal income, excluding motor fuel, mineral severance, alcohol sales, and tobacco sales taxes. Because of interstate investment, commuting, and tourism, tax collections do not always line up with tax burdens on residents.
- Government Spending
- State and local government consumption and subsidies as a percentage of personal income.
- Gun Control
- The direct costs of gun laws to gun owners and dealers as evidenced in sales, price, and ownership figures, as well as original analysis about how concealed-carry restrictions and costs are associated with the number of people who seek permits in each state.
- Alcohol Distribution
- A measure of state control of the alcohol distribution system. Research shows that state distribution of alcohol imposes significant costs on consumers in time and inconvenience.
- Beer Taxes
- Beer tax rates
- Blue Laws
- Blue laws ban sales of alcohol on Sunday.
- Happy Hour Laws
- Bans on happy hours
- Keg Regulations
- Statewide beer keg registration requirement or kegs banned.
- An index of medical marijuana policies combined with the other marijuana policy variables.
- Salvia ban
- Is there Salvia divinorum ban?
- Spirit Taxes
- Spirits tax/markup rate
- Mandatory Server Training
- Mandatory alcoholic beverage server training law
- Wine Taxes
- Wine tax/markup rate
- Un/underinsured motorist insurance required
- Is uninsured/underinsured coverage required?
- Seat belt enforcement
- Whether there is a seat belt law for adults and how it is enforced.
- Bike helmet laws
- Do bicycle helmet laws exist?
- Cell phone driving ban
- Is there a statewide ban on handheld cell phones for all drivers?
- DNA taken from arrestees
- May police take DNA samples from arrestees?
- Fireworks laws
- A measure of a variety of fireworks laws.
- Gambling felony
- Is aggravated gambling a felony?
- Gaming revenues
- Gaming revenues in ratio to statewide personal income
- Motorcycle helmet laws
- Is there a motorcycle helmet law covering all drivers?
- Internet gaming prohibition
- Is there an express prohibition on Internet gambling?
- Open container laws
- Is there an open container law for automobile drivers or passengers?
- Physician-assisted suicide legal
- Is physician-assisted suicide legalized?
- Prostitution legal
- Is there a local option for prostitution legalization?
- Raw milk sales legal
- Are raw milk sales legal for human consumption?
- Two-party consent for recording
- Are there two-party consent laws for recording public officials?
- Religious Freedom Restoration Act
- A measure of the religious freedom restoration act.
- Sobriety checkpoints
- Are sobriety checkpoints authorized?
- Social gaming exception
- Is social gambling allowed?
- Trans-fat bans
- Is there a statewide trans-fat ban in restaurants?
- Compulsory schooling years
- A measure of the range of ages where schooling is compulsory.
- Homeschooling curriculum control
- Are there required subjects/curriculum for homeschoolers?
- Homeschooling law
- Is homeschooling explicitly permitted by statute?
- Homeschooling notification requirements
- Homeschooling notification index
- Homeschooling recordkeeping requirements
- Extent of homeschool recordkeeping requirements.
- Homeschooling standardized testing
- Is standardized testing or other official evaluation required?
- Homeschooling teacher qualifications
- Are teacher qualifications required?
- Mandatory kindergarten
- Is kindergarten attendance required?
- Private school approval required
- Is there mandatory state approval or accreditation of private schools?
- Private school teacher licensure
- Is there mandatory state licensure of private school teachers?
- Private school registration
- Is there mandatory registration of private schools?
- Private school curriculum control
- Extent of private school curriculum control.
- Tax credit/deduction
- Is there a tax credit/deduction law for scholarship contributions or educational expenses of parents?
- Local rent control
- Do local rent control laws exist?
- Regulatory taking restrictions
- Is compensation required for or economic assessment required before regulatory taking?
- Mandated free speech on private property
- Is there mandated free speech on private property?
- Wharton Residential Land Use Regulatory Index
- Wharton Residential Land Use Regulatory Index
- Workers' comp coverage regulations
- A measure of a variety of workers' compensation regulations.
- Workers' comp funding regulations
- A measure of a variety of funding options for workers' compensation
- Short-term disability insurance
- Is there a short-term disability insurance program?
- Is there a paid family leave
- Paid family leave insurance program?
- Minimum wage
- If the state has a minimum wage higher than the federal minimum wage
- Right to work
- Is there a general right-to-work law?
- Employer verification of legal status
- Is there employer verification of legal resident status?
- Financial incentives to providers banned
- Are there bans on financial incentives to providers to withhold covered care?
- COBRA continuation, small firms
- Is COBRA continuation coverage expanded to firms with less than twenty employees?
- Group conversion rating limits
- Are there mandatory group conversion coverage rating limits for small firm employees?
- Group conversion coverage, small firms
- Is there mandatory group conversion coverage for small firm employees?
- Individual policies: elimination riders banned
- Are elimination riders for individual health insurance banned?
- Individual health insurance mandate
- Is there an individual health insurance mandate?
- Individual guaranteed issue
- A measure of rules on guaranteed issue of health plans.
- Community rating: individuals
- Are there individual market rate restrictions?
- Individual rate review
- Is there individual rate review?
- Mandated external grievance review
- Is there mandated external review for certain types of grievances?
- “Mandate-free” or “mandate-light” policies
- Are “mandate-free” or “mandate-light” health insurance policies permitted?
- Health insurance mandates index
- A measure of a variety of health insurance mandates. State-level health insurance mandates impose direct costs of nearly $9 billion a year.
- Direct access to specialists mandated
- Are there mandates for direct access to providers?
- Community rating: small groups
- A measure of small group health insurance market rate restrictions (i.e., community rating). These are effectively a form of price control that redistributes wealth from the healthy to the unhealthy and cost over $9.5 billion a year.
- Small-group rate review
- Is there small-group rate review?
- Standing referrals mandated
- Are standing referrals to specialists mandated?
- Tobacco freedom
- A measure of a variety of laws, including taxes on tobacco, smoking bans, Internet sales bans, and vending machine regulations.
- Smoker protection laws
- Are regulations for "smoker protection" in employment?
- Statewide cable franchising
- Cable legislation for state issued franchise companies.
- Telecom deregulation
- A measure of telecommunication deregulation.
- Dental hygienist independent practice
- May dental hygienists initiate treatment without dentist authorization?
- Education and experience requirements
- Summed education/experience requirements for all occupations licensed.
- Employment-weighted licensure
- A measure of the extent of licensure.
- Exam requirements
- A measure of the exam requirements for all occupations licensed.
- Fees for licensed occupations
- A measure of the fees for all occupations licensed.
- Nurse licensure compact membership
- Is the state a member of Nurse Licensure Compact, permitting multistate practice?
- Nurse practitioner independent practice
- Are nurse practitioners allowed to practice independently from MDs?
- Physician assistant prescribing authority
- May physician assistants prescribe controlled substances?
- Asset forfeiture rules
- A measure of a variety of laws governing asset forfeiture, including what standard of proof is required, whether the burden of proof is on the owner, and what percentage of the proceeds from forfeiture can go to law enforcement.
- Eminent domain index
- A measure of a variety of laws protecting private property from eminent domain abuse.
- Certificate of need for hospitals
- Is there a certificate of need requirement for hospitals?
- Rate filing requirements: homeowners' insurance
- A measure of the state rate filing requirements for homeowners' insurance
- Interstate insurance product regulations compact
- Is the state a member of interstate insurance product regulation compact?
- Rate filing requirements: personal auto insurance
- A measure of the state rate filing requirements for personal auto insurance.
- Rate classification prohibitions
- Are there state rate classification prohibitions for some classes of insurance (age, gender, credit rating, territory, etc.)?
- Ranking of State Liability Systems
- A measure of a state's liability system from the US Chamber of Commerce.
- Arrests for non-drug victimless crimes, % of all arrests
- A measure of a variety of arrest rates for non-drug related victimless crimes.
- Drug enforcement rate
- A measure of the drug enforcement rate.
- Crime rate-adjusted incarceration rate
- A measure of the incarceration rate adjusting for the violent and property crime rates.
- Arrests for non-drug victimless crimes, % of population
- The arrest rate for non-drug victimless crimes compared to all arrests.
- Blood test requirement
- Is a blood test required for marriage?
- Same-sex partnerships
- A measure of whether states offer a convenient form of life partnership contract, whether civil unions or marriage.
- Total waiting period
- A measure of the total waiting period between applying for a marriage license and being able to marry.
- Grassroots PAC contributions to candidates
- A measure of rules governing PAC contributions to candidates.
- Grassroots PAC contributions to parties
- A measure of rules governing PAC contributions to parties.
- Individual contributions to candidates
- A measure of rules governing individual contributions to candidates.
- Individual conributions to parties
- A measure of rules governing individual contributions to parties.
- Public financing
- A measure of a variety of laws governing public financing for election campaigns.
This section contains all the variables in the index and links to source information where available.