The Bureau of Economic Analysis has been working on creating state and metro cost of living indices for several years and they have just published a new set of them that can be used to create real per capita income comparisons between states.
In their press release they show a map comparing real growth in 2012 that ranged from plus 12.7% in North Dakota and minus -2.3% in South Dakota.
http://www.bea.gov/newsreleases/regional/rpp/rpp_newsrelease.htm
But I found the ranking of the states real per capita income much more interesting.
Technically, the District of Columbia has the highest real per capita income but I suspect that measure is distorted the same way the D.C. real GDP is distorted. Many people work in D.C., but commute in from other states. Because they live elsewhere they are counted in those states population, but their income or output generated in D.C. is included in the D.C data. Interestingly, Luxemburg has the same distortion that gives it the highest real per capita GDP in Europe.
BEA had published some preliminary results from this for 2005. The biggest change from that data appears to be New York moving from near the bottom of the ranking to number 15 and Texas falling from number 15th in rank to number 24th. Deleware fell from number 1 to number 28th in rank. I suspect that the major reasons for these rank changes stemmed from improvements in the data and methodology since BEA did the 2005 calculations.
Differences in rent is the major factor driving the differences in the cost of living by state. For example, the Massachusetts price index is index is 107.2 and within that rent is 121.4. In Mississippi, in contrast the overall price index is 86.4 and the rent index is 62.1. So the difference in the overall index is about 14 while the rent index spread is about 60. Rent in Massachusetts is approximately double rent in Mississippi. Mississippi has the lowest rent in the country while Hawaii is the highest at 159. Hawaii has the second highest overall cost of living at 117.2 compared to 118.2 in Washington, D.C.. Only 14 states regional price indices are greater than 100.
