Featured image for article

Daily Journal: Our economy needs new enterprises

John Hood writes for Carolina Journal’s Daily Journal that while North Carolina’s economy is in reasonably good shape with a job-creation rate exceeding the national average and average income per person growing faster than the national average, the economy would be better off if more people were starting new enterprise in the state.

Among the 25 largest states in the country, we rank a pretty good 9th in startup activity but only 18th in entrepreneurial growth, a measure from the Kauffman Foundation that assesses how much and how quickly new companies expand.

I suspect you agree with me that more economic progress is needed in North Carolina, and that fostering entrepreneurship is particularly important. It’s when we turn to solutions that the disagreements arise, and all too often degenerate from substantive debate to political shouting matches.

Conservatives think the answer lies in continuing to lower the cost of doing business in our state while increasing the real-world return on the dollars North Carolinians already spend on schools, highways, public safety, and other government functions.

Progressives think the conservatives’ focus on cost is misguided — that if policymakers raised taxes or increased regulatory costs for the right reasons, to deliver higher-quality services or better production of public health and safety, North Carolina’s economy would grow faster and offer more opportunities to more people.

As should be obvious by now, I think the conservatives have the better argument. It has more research support from peer-reviewed studies that explore which factors most influence state and local economic growth. The most important factors, frankly, don’t have much to do with politics. Geography is immensely important. So are technological and organizational changes within private industry.

Read more here.

Reader Comments