April 18, 2016

New Study Reveals How Federal Regulations Affect Each U.S. State

Last week, the Mercatus Center at George Mason University released a study, called the Federal Regulation And State Enterprise, or FRASE, index, that analyzed the impact federal regulations have on each U.S. state. 

As the center explains, “Although federal regulation applies in the same way in all states, each state’s economy includes a unique mix of industries. As a result, federal policies that target specific sectors of the economy will affect states in different ways.” The index attempts to quantify these differences through an examination of the Code of Federal Regulations (CFR), which annually compiles all current federal regulations. 

Currently, the CFR is more than 175,000 pages long and is published in 236 volumes. It includes one million individual restrictions “that mandate or prohibit some activity.” The center noted the CFR is twice as long as it was just 40 years ago, in 1975. 

The ten states where federal regulations are most burdensome are: Louisiana, Alaska, Wyoming, Indiana, Kentucky, Texas, Nebraska, West Virginia, North Dakota and Montana. 

The report explains each state’s rank. For example, for Louisiana, the center explained, “The main driver of Louisiana’s ranking is the chemical products manufacturing industry. As Louisiana’s second largest industry, it represents 8.1 percent of the state’s private sector, more than three times the national average of 2.2 percent. Chemical products manufacturing is also subject to more than 10 times as many restrictions as is the median industry, giving its higher proportion of the state’s economy greater effect. Other highly restricted industries contributing to Louisiana’s high ranking include retail trade, oil and gas extraction, and construction.” 

Click here to read the full report and to see where your state ranks.