List of states by adjusted per capita personal income estimates the per capita personal income of residents of U.S. states adjusted by differences in the cost of living, called "regional price parities" by the U.S. Bureau of Economic Analysis. The BEA defines regional price parities as an estimate of "the differences in price levels across states and metropolitan areas for a given year and are expressed as a percentage of the overall national price level."[1] The BEA defines personal income as follows:

Personal income is the income received by, or on behalf of, all persons from all sources: from participation as laborers in production, from owning a home or business, from the ownership of financial assets, and from government and business in the form of transfers. It includes income from domestic sources as well as the rest of world. It does not include realized or unrealized capital gains or losses. Personal income is estimated before the deduction of personal income taxes and other personal taxes and is reported in current dollars (no adjustment is made for price changes).[2]

Per Capita Personal Income (PCPI) is a more inclusive estimate of the average standard of living of citizens and residents in the U.S. than measures of per capita income. PCPI "includes wages, benefits, proprietor income, dividends, interest, rent, and transfer payments" such as Social Security, veteran's benefits, farm subsidies, welfare, and food stamps.[3]

The differences in estimates of per capita income and per capita personal income is large. In 2019, the U.S. Census Bureau calculated a per capita income of the United States as 34,103 dollars.[4] The U.S. Bureau of Economic Analysis calculated the PCPI as 56,490 dollars.[5]

A more valid accounting of the differences in the standard of living of American citizens in different states requires recognition that prices vary from state to state and community to community. In general, a dollar has more purchasing power in the poorer states than it does in the richer states. The difference in housing costs from state to state is especially important. The Bureau of Economic Analysis has calculated that the regional price parity of U.S. states ranges from 84.4 in Mississippi (the cheapest state in which to live) to Hawaii at 119.3 (the most expensive state). In other words, an income of $0.84 in Mississippi equals an income of $1.19 in Hawaii with the U.S as a whole having an average PCPI of $1.00. To put it another way, the purchasing power of a dollar is $1.18 in Mississippi and $0.84 in Hawaii. The net impact of accounting for differences in the purchasing power of a dollar in different states is to narrow the gap in the standard of living between rich and poor states.[6]

Ranking states by PCPI, adjusted by regional price parity

Data in this table are from the Bureau of Economic Analysis (BEA) and are for the year 2022.[7] Adjusted personal income is found by dividing personal income by price parity.

Location PCPI Price
parity		 PCPI
adj.
 United States 65,470 $1.00 65,470
 District of Columbia 95,970 $1.13 85,044
 Wyoming 73,248 $0.92 79,701
 North Dakota 70,360 $0.89 79,363
 Connecticut 82,938 $1.06 77,940
 South Dakota 68,176 $0.88 77,481
 Massachusetts 84,561 $1.09 77,300
 Colorado 75,722 $1.02 74,025
 Nebraska 64,268 $0.90 71,563
 New Jersey 77,199 $1.09 70,983
 Minnesota 68,840 $0.98 70,445
 New York 75,407 $1.08 70,082
 New Hampshire 73,910 $1.08 68,662
 Washington 75,332 $1.10 68,578
 California 77,036 $1.12 68,495
 Iowa 60,222 $0.88 68,107
 Montana 60,984 $0.90 67,560
 Virginia 68,985 $1.02 67,542
 Alaska 68,635 $1.02 67,296
 Kansas 60,424 $0.90 67,167
 Pennsylvania 64,506 $0.96 67,042
 Maryland 70,228 $1.05 66,911
 Illinois 67,655 $1.01 66,815
 Wisconsin 61,475 $0.92 66,596
 Delaware 63,243 $0.98 64,562
 Nevada 62,085 $0.96 64,415
 Texas 62,586 $0.98 64,183
 Indiana 58,323 $0.92 63,521
 Tennessee 58,292 $0.92 63,501
 Missouri 57,818 $0.91 63,453
 Florida 64,806 $1.02 63,446
 Oklahoma 56,298 $0.89 63,419
 Ohio 57,777 $0.91 63,179
 Utah 59,457 $0.94 62,937
 Vermont 63,039 $1.01 62,356
 North Carolina 58,109 $0.94 61,684
 Idaho 56,614 $0.92 61,653
 Michigan 57,038 $0.93 61,050
 Arkansas 52,618 $0.87 60,762
 Rhode Island 63,557 $1.05 60,704
 Louisiana 54,501 $0.91 60,176
 Maine 60,599 $1.01 60,095
 Georgia 56,589 $0.96 59,050
 Arizona 58,442 $1.00 58,502
 Oregon 62,303 $1.07 58,465
 Kentucky 51,921 $0.89 58,106
 Alabama 50,916 $0.88 58,007
 New Mexico 52,194 $0.91 57,368
 South Carolina 53,618 $0.94 57,314
 West Virginia 49,993 $0.89 56,018
 Hawaii 61,779 $1.11 55,738
 Mississippi 46,370 $0.87 53,099

References

  1. ^ "Regional Price Parities by State and Metro Area". Bureau of Economic Analysis. Retrieved 25 January 2021.
  2. ^ "Personal Income by County and Metropolitan Area, 2019" (PDF). Bureau of Economic Analysis. Retrieved 24 January 2021.
  3. ^ "What is the difference between GDP and personal Income?". Montana.gov: Official State Website. Retrieved 24 January 2021.
  4. ^ "Quick Facts: United States Census Bureau". United States Census Bureau. Retrieved 24 January 2021.
  5. ^ "Press Release: Real Personal Income by State and Metro Area in 2019" (PDF). Bureau of Economic Analysis. Retrieved 24 January 2021.
  6. ^ Sauter, Michael B. (25 November 2020). "Arkansas, Mississippi are among the states where a dollar has the highest value". USA Today: Money. Retrieved 24 January 2021.
  7. ^ Under the first section 'Summary table...' select the top entry. Select 'All areas'. Select 'Per capita personal income' and/or 'Regional price parities (RPPs)'. Select 'Levels' and next, the most recent year. "Regional Data". bea.org. Retrieved 13 Feb 2024.
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