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South Dakota 11th in Well-Being, 2nd in Business Tax Climate: Correlations?

Last updated on 2013.10.14

A friend sends me the latest Gallup-Healthways Well-Being Index, which finds that South Dakotans just barely miss the top ten for folks who feel like they're living the good life. We rank 11th on personal perception of well-being. A number of our neighbors make the top ten:

  1. Hawaii
  2. North Dakota
  3. Minnesota
  4. Alaska
  5. Utah
  6. Colorado
  7. Kansas
  8. Nebraska
  9. New Hampshire
  10. Montana

Iowa is 16th; Wyoming is 21st.

That list got me thinking about the Tax Foundation's ranking of state business climates, in which South Dakota ranks second:

  1. Wyoming
  2. South Dakota
  3. Nevada
  4. Alaska
  5. Florida
  6. New Hampshire
  7. Washington
  8. Montana
  9. Texas
  10. Utah

Hmm... there is some overlap there... but then I put the rankings on both the Well-Being Index and the Business Tax Climate Index into my spreadsheet... and get a correlation of -0.04. That means, basically, there is no correlation. You can't look at business tax climate and predict well-being, or vice versa.

Gallup also breaks down the Well-Being Index by Congressional district. South Dakota is one big happy family by district, so on this scale, our whole state is compared to all sorts of little gerrymanders in California, Texas, and New York. Our state ranks 104th out of 436 districts (including the District of Columbia). That's roughly proportionate to our 11 out of 50 rank on the state-by-state count.

California ranks 18th for overall well-being, but it holds five of the top ten spots for happy Congressional districts.

I got curious as to whether I could find any correlation between Congressional district party preference and well-being. Looking at the 103 Congressional districts that have higher well-being scores than South Dakota, I find 52% held by Republicans. That's slightly lower than the 56% of all Congressional seats currently held by Republicans.

Ah ha! I thought. Maybe Republicans correlate just slightly with a more dissatisfied electorate. But then I run the correlation between well-being rank and party of Representative for the whole list of districts (where, in a gift to my conservative readers, I let Dem equal zero and GOP equal one): -0.05. Again, no substantial correlation.

So the big news on these numbers is no news. Enjoy your breakfast!


  1. Troy Jones 2012.03.06

    I love it. Regression analysis and application of the "dismal science" (economics) to social science and political science.

    Suggestion to see if there is a correlation:

    1) Throw out the highest and lowerst five states of both categories. If you get a significant "negative correlation" this will show significant correlation in the bottom performers indicating in those in the middle have complicating factors.

    2) List them side by-side and start in the middle moving both directions taking out a total of 10 states who are in the middle and run your numbers. (i don't think I'm describing this right and I don't know for sure if this is statistically the right way to do it. Stats class is a long ways away. But I remember there are multiple ways to find correlation by finding non-correlation).

    Sidenote: I'm not sure your party analysis will prove anything. I would focus on business climate/well being. People live where they want to live (which is where their Members come from), generally more liberals live in urban areas and conservatives in rural areas, and they vote their values. I can't imagine how you get a correlatoin between perception of well-being of the individual and the collective political judgment of one's neighbors.

  2. Troy Jones 2012.03.06

    Editing mistake: Typing faster than my mind (not hard).

    1) Delete second sentence and insert "If you get a significant “negative correlation” in the middle states this will show significant correlation in the top and bottom performers indicating in those in the middle have complicating factors.

  3. Elliot Knuths 2012.03.06

    We need to remember that correlation doesn't always imply causation...

  4. Troy Jones 2012.03.06

    Elliot, I get your point, except correlatoin does IMPLY causation but in reality it could be just a coincidence or there is a common cause of both not yet discovered.

  5. WayneB 2012.03.06

    Here's a simple one - how's everyone's sense of wellbeing rate against their actual mortality & morbidity? Look at average life expectancy, mortality rates, etc.

  6. Stan Gibilisco 2012.03.06

    Cory's saying he can find no correlation. So I guess that means no causation is involved either. (How can you have a cause for an effect that does not exist?)

    Having lived in places ranging all the way from best for business (South Dakota and Nevada) to among the worst (California and Hawaii), and all the way from best for well-being (Hawaii) to among the worst (Florida), I can say that Cory's theoretical conclusion holds up in my experience. The happiest folks were in Kona, Hawaii. The most miserable in general were in Miami, Florida.

  7. D.E. Bishop 2012.03.06

    Is there any type of study of labor happiness? I'm guessing that it would the inverse of "business-friendly." If that is the case, it would seem that businesses prosper at the expense of labor.

    Paraphrasing Rodney King: Can't they both just prosper together?

  8. Stan Gibilisco 2012.03.06

    In my sole proprietorship (Stanley the Scrivener), business and labor are one. They prosper together, and they struggle together. They live or die together. They go to heaven or ...

    Contrast this paradigm with, say, that of a large multilational corporation!

    A state that's friendly to one type of business might be hostile to another, so really, trying to quantify "business friendliness" constitutes a futile and meaningless exercise.

    Aw, shucks. Somebody's gotta get paid to make up all those tables and charts so we can decide whether we're happy or not, whether we're prosperous or not, whether happiness and prosperity are related ... or not, or not, or not.

  9. D.E. Bishop 2012.03.07

    Doesn't it seem odd that "Business Climate" is carefully measured, and a good one deftly courted, while Labor is ignored? Doesn't one require the other? Wouldn't a good Labor Climate also be good for a state?

    It seems to me that Labor and Business do not have to be at odds as they are now. Anyone agree?

  10. Troy 2012.03.07

    Since most of the people are working and they are asked how their well-being, isn't that the same thing? Looking for dissent where it isn't.

  11. caheidelberger Post author | 2012.03.07

    Odd indeed, D.E.! But therein lies something scary about modern capitalism: when computers help us do more work with fewer people, sharing the gains with the working class may seem less important to narrow-minded capital. But we've got to keep an eye on the big picture: if the working class can't buy, the economy can't grow.

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