The 20th century could be viewed as Wisconsin’s progressive century. Wisconsin was the first state to establish a personal income tax (1911) and to allow collective bargaining by public sector unions (1959). Business regulation was strict. Labor laws favored unionization. Taxes were high. The tax burden on Wisconsinites at the end of the 20th century was the second highest in the nation.

Then, after a century of progressivism, Wisconsin broke with its past.

Starting in 2011, Wisconsin undertook a new experiment, this time in free-market economics. In little more than a decade, Wisconsin was transformed from one of the most government-centric states to one that is now ranked in the top half in terms of economic freedom. Wisconsin is no longer an extraordinarily high-tax state. The tax burden on Wisconsinites is closer to the U.S. average. Labor markets in Wisconsin have become more flexible. Government spending has been restrained.

This chapter of the 2026 Mandate for Madison assesses the impact of these reforms by comparing economic growth in Wisconsin’s border counties with counties on the other side of the border in Illinois and Minnesota (both of which remain near the bottom of state economic freedom rankings).

Evidence shows that growth in Wisconsin border counties has been stronger than on the opposite side in the reform era and that Wisconsin has been more successful at attracting and retaining interstate migrants. These results are consistent with decades of international and state-level evidence showing a strong link between increased economic freedom and prosperity.

State can’t afford to go backward