He finds the answer in housing costs. Wages are 12% lower in Houston versus NY, for instance, but housing in NY is 60% higher in NY than Houston. And why is that? Partly population density and geography (huh?) he claims. But the real difference:
However, as Harvard’s Edward Glaeser and others have emphasized, high housing prices in slow-growing states also owe a lot to policies that sharply limit construction. Limits on building height in the cities, zoning that blocks denser development in the suburbs and other policies constrict housing on both coasts; meanwhile, looser regulation in the South has kept the supply of housing elastic and the cost of living low.
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