Business executives generally loathe high taxes and heavy regulation. So it is no surprise that they rank states that are excessive on either or both counts as the worst places to do business. Chief Executive magazine is out with its annual list of the best and worst states. Predictably, New Jersey, Illinois, New York and California top the bottom of the list, in that order.

Even allowing for geographic location and weather patterns that are immutable, state economic conditions vary widely. The evidence suggests that pro-growth policies influence perceptions of competitiveness, particularly in the eyes of business leaders. Earlier this year, Chief Executive asked 513 CEOs to rank states they are familiar with on the friendliness of their tax and regulatory regime, workforce quality and living environment. (This latter category includes not just the cost of living but the education system and the state and local attitudes toward business).

The top 5: Indiana moves up, replaces Georgia.
The top 5: Indiana moves up, replaces Georgia.

Texas and Florida top the list, as they have every year for the past 12 years that we have conducted this survey. Despite having been hit hard by the shale energy bust, Texas is still held in high esteem by CEOs for its favorable economic reforms. But each year, Florida steadily edges up in the qualitative measures. The Sunshine State added 1 million private-sector jobs over the last five years, cut taxes 50 times and got rid of 4,200 burdensome regulations. In 2014, it surpassed New York as the third-biggest state for companies to flourish.

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