How Far Does $100 Go In California?

Here in Louisiana, a dollar goes quite a bit further than it does in most other states and its relative value is rising, as reported by a new report from The Tax Foundation that’s based on recently-released data from The Bureau of Economic Analysis on personal income for 2013. “This has a few unexpected consequences; people in high-price-level states like New Jersey will often pay more in federal taxes without feeling particularly rich”.

Meanwhile, Hawaii, a state with the second-lowest purchasing power of an $86 value per $100 spent, had a 2013 per capita income of $45,204. The Tax Foundation has in recent years compiled a map of all states showing what the relative value of $100 is in each.

When looking at the state’s neighbors, $100 in Idaho is really worth $107.76.

To no one’s surprise, $100 for expenses in states like New York are drastically different than Mississippi ($86.73 to $115.21).

Price differences throughout the USA are considerable.

The BEA data show how large the regional price differences are. “In places with higher incomes, the prices of finite resources like land get bid up”, the Tax Foundation reports.

When the cost of living is accounted for, workers in right-to-work states enjoy higher real, spendable income than workers in forced union membership states. “This is what labor economists call a compensating differential; the higher pay is offered in order to make up for the low purchasing power”.

A few states, the report says, have high incomes without high prices. The same income will typically buy a much better standard of living for a family living in a right-to-work state than in a forced unionism state.

“Adjusting incomes for price level can substantially change our perceptions of which states are truly poor or rich”, The Tax Foundation report states.