Guess what they found? People are moving from high tax states (e. g., CA, NY) to low tax states (e. g., TX, FL). They quote the Atlanta Federal Reserve Board as follows: "Relative marginal tax rates have a statistically significant negative relationship with relative state growth." That is academic-speak for higher taxes mean slower growth.
The other key variable they found was right-to-work laws. Companies locate new plants in states where there are right-to-work laws. State right-to-work laws prohibit union contracts requiring workers to belong to unions.
To summarize their findings: Jobs and therefore people are moving away from states with high income tax rates and no right-to-work laws. Jobs and the people they employ are moving to states with no income taxes and right-to-work laws. This isn't rocket science.
Laffer and Moore draw this parallel in their summary:
The states losing population are in effect suffering from a slow-motion version of the economic sclerosis that paralyzed much of Europe in the 1980s and '90s, particularly France and Germany with their massive welfare systems.
Their entire article is worth your time if you can gain access.
