O'Neil Center Economic Insights

Testing Tiebout: Interstate Migration and Economic Freedom

In the mid-1950s, economist Charles Tiebout found larger meaning in migration patterns by asserting that households choose where to live based on state and local government policies, including taxes and spending. In effect, people vote with their feet. Using data on state-to-state movements from 2004-08, O’Neil Center director W. Michael Cox and his colleague Richard Alm find that states can make themselves more attractive to domestic migrants by lowering taxes, reining in spending growth, enacting right-to-work laws, limiting the land-use restrictions that raise housing prices and improving education without spending a lot of money. download a .pdf

The O’Neil Center Takes on Paul Krugman

Director W. Michael Cox and writer in residence Richard Alm rebut a recent Paul Krugman column, which argued that Texas’ budgetary problems expose fundamental flaws in the state’s highly touted mix of low taxes, tight budget and business-friendly policies. Cox and Alm point out that employment gains and net in-migration are better gauges than budget shortfalls for judging economic policies. In both, Texas leads the nation—by a long shot. Budget woes in Texas, like those in nearly all other states, come from the national recession, not from the state’s failure to tax more and spend more. download a .pdf

Prosperity and Its Enemies

John Stossel, a news analyst for the Fox Business Network and one of the few journalists that wholeheartedly embraces the cause of economic freedom, discusses why capitalism works in this lightly edited version of a speech given at an O’Neil Center luncheon on March 30, 2011. Using examples from his own career and life, he explains his personal transformation from an anti-business, big-government-fixes-all reporter to a promoter of capitalism and free trade.  For more information on Stossel’s work, please visit http://stosselintheclassroom.org.  download a .pdf