Wednesday, April 09, 2008

Kudlow & Co: Goldilocks Rocks in Texas

The CD graph above was featured on CNBC's "Kudlow & Company" tonight, during the segment "Texas Economics" (starting about 0:45) featuring Texas Governor Rick Perry (no relation!) discussing the recession-proof Texas economy. Texas had the lowest unemployment rate in February (4.1%) since the 1970s (see chart below from this CD post), and cities like Dallas and Houston are booming!


4 Comments:

At 4/09/2008 11:29 PM, Anonymous Anonymous said...

Goldilocks?

Texas has a higher employment-to-population ratio, meaning a larger share of the adult population is employed. This is due to differences both in Texas' demographic composition and a higher propensity of the Texas population to work. With regard to demographics, Texas has larger population shares of the age groups that are characterized by higher participation rates, such as prime-age individuals 25 to 54. At the same time, Texas has fewer older peopleā€”a portion of the population that is typically not employed. For example, in 2004, 25 percent of the adult civilian population in Texas was over the age of 54, while in the United States 28.5 percent was. Some of the differences in the labor force participation rates are also explained by the foreign-born share of the population. Texas has a greater percentage of foreign-born residents, and foreign-born men are characterized by higher labor force participation rates than U.S.-born men. Undocumented foreign-born men in particular have very high labor force participation rates.[1]

In addition to demographic differences, institutional differences help to explain higher labor force participation rates in Texas. Texas does not have a state income tax. It also has less generous safety net programs relative to the other large states. As a result, there are greater incentives in Texas to participate in the labor force than there are in many other states.


http://www.dallasfed.org/research/swe/2005/swe0506a.html

 
At 4/10/2008 4:16 AM, Blogger juandos said...

Goldilocks?

You bet!

"Texas does not have a state income tax. It also has less generous safety net programs relative to the other large states. As a result, there are greater incentives in Texas to participate in the labor force than there are in many other states"...

Its called, "just say no to parasitism,"...

 
At 4/10/2008 11:27 AM, Anonymous diz said...

Well, there's also an oil and gas boom going on here.

 
At 4/10/2008 12:11 PM, Blogger bobble said...

its the PRICE OF OIL, fer cryin' out loud! look at this chart of west texas crude:

crude oil price history

1980 crude peaks at$40 / unempl hits a low of 4.5%
1985 crude hits a low of $10 / unempl hits a high of 9%

1985-1999 oil stays low unempl stays high

1999 to now, oil surges to $100 / unempl drops to 4%

professor perry, if you want to prove YOUR point, please superimpose a line showing the level of taxes in houston over time with the unemployment rate.

 

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