To answer this question, we calculated two measures of the state’s economic performance: the percent change in total employment by state from 2009-19 and the percent change in per capita income by state from 2009-19.
Are the number of words of regulation by state inversely related to these measures of macroeconomic performance? The answer is YES.
A 10% increase in words of regulation per employee results in a 3% decrease in the growth rate of total employment, and it results in a 1% decrease in the growth rate of per capita income.
Both relationships are statistically significant at the highest level. And the words of regulation per employee are adjusted for the scale economies of larger states.