Kansas ranks 14th nationally, with an overall score of 7.12, in the Economic Freedom of North America report published by the Fraser Institute. The ranking, based on 2023 data, places Kansas just outside the top quartile of states. That position tells a precise economic story. Kansas has restored stability after years of fiscal turbulence from the excessive spending under Governor Kelly and the lack of spending restraint to go with then-Governor Brownback’s tax cuts. And yet, the conditions for sustained acceleration have not been met.
The labor market illustrates the point. According to the Bureau of Labor Statistics, Kansas’ unemployment rate has remained relatively low since 2021 and generally tracks close to the national average. That outcome reflects a labor market that has absorbed shocks without prolonged dislocation. But stability is not the same as expansion. Job growth in Kansas has largely tracked population growth rather than exceeding it, indicating limited growth in labor demand rather than a tight labor supply.
Economic freedom, or lack thereof, can help explain the difference. States that consistently outperform improve labor demand by reducing barriers to investment and expansion. EFNA measures this through labor-market flexibility, tax burdens, and government size relative to income. Kansas performs reasonably well on labor markets, with relatively low union density and predictable employment rules. Recent tax reforms also improved marginal incentives and reduced uncertainty compared with earlier periods of policy volatility.
But EFNA indicates that these improvements did not translate into a higher overall ranking for The Sunflower State. Government spending grew faster than personal income, particularly during recent revenue windfalls during COVID-19. Because EFNA measures spending as a share of income, this expansion directly reduced the spending component score and offset gains elsewhere.
This matters economically. Higher government spending today implies higher taxes or debt tomorrow. Even when budgets appear balanced, households and firms adjust their behavior based on expected future burdens. The result is lower capital formation and slower productivity growth.
Property taxes are the clearest channel. While attention often focuses on state-level income taxes, local property-tax collections in Kansas have continued to rise, increasing the cost of capital and housing. From an economic perspective, shifting the tax burden rather than reducing it does not increase freedom. EFNA treats the combined state-and-local burden as what matters, because that is what households and firms actually face.
Output data reinforce the diagnosis. The Bureau of Economic Analysis’s state GDP figures show Kansas real GDP growth lagging that of faster-reforming peers such as Oklahoma and Nebraska in 2023, particularly in private investment–intensive sectors. Kansas has grown, but more slowly in sectors with the highest capital mobility. That is exactly what economic theory predicts when spending growth leads to higher taxes, thereby weakening expected returns.
Directionally, Kansas’s EFNA ranking improved earlier in the last decade, then flattened in recent years. That pattern is coherent. Initial reforms improved labor and tax components, lifting the score. Subsequent spending growth offset those gains, producing a plateau. The EFNA report uses 2023 data, meaning recent discussions about spending restraint or tax base reform are not yet reflected. What is reflected is the cumulative effect of decisions made during surplus years.
This timing distinction matters for policymakers. EFNA should be read as a report card on past policy choices, not a forecast of future outcomes. If spending restraint becomes institutionalized, it will show up in future rankings. If not, Kansas will remain stuck just outside the top tier.
The long-run findings of the Fraser Institute are consistent across decades. States with higher economic freedom experience stronger job creation, higher incomes, greater capital inflows, and more upward mobility. Kansas has laid part of that foundation. Labor markets are flexible. Taxes are more competitive than they once were. What remains is the hardest part of reform: restraint during good times.
Kansas does not need new incentives or targeted programs. It needs consistency. Without binding limits on spending growth tied to population growth and inflation, further reforms will yield diminishing returns. Stability has been restored. Whether Kansas accelerates from here will depend on whether economic freedom is allowed to compound.
