Good Jobs First, a left-leaning nonprofit, attracted a lot of attention this week with a new study claiming business climate studies are

…politicized grab-bags of data. They have no predictive value and should not be used to inform public policies.

Some of the attention came from one of the groups they criticized, the Beacon Hill Institute. As a result of that criticism, they took the study off their website. The BHI challenge is reported in the Des Moines Register.

We don’t report all the numbers in our competitiveness study, because there are reams and reams of numbers,” said David Tuerck, executive director of the Beacon Hill Institute at Suffolk University, today.

The Beacon Hill Institute’s business-climate competitiveness study was part of a report from Peter Fisher, an economist at the Iowa Policy Project in Iowa City, and released by Good Jobs First, based in Washington, D.C. Both are nonprofit research groups.

Fisher is not new to the business of debunking business climate studies. In 2005 he put out Grading Places through the Employment Policy Institute, a labor-backed group that pursues an agressive liberal policy agenda. And last November Fisher co-authored with the leader of Good Jobs First a piece challenging the conservative American Legislative Exchange Council with the delicate title, Selling Snake Oil to the States.

While we’ve frequently written that the notion of “best business climate” will hinge on a variety of factors, we sharply disagree with the allegation that such studies are bunk. We covered the issue in more depth in our report, Characteristics of a Healthy Business Climate.

While the measurements vary, the substance of most business climate studies remains consistent. High quality public services and competitive costs are critical to a state’s long-term growth prospects.

“Our study does not try to correct these rankings or present a new rating,” said Greg LeRoy, executive director of Good Jobs First. “Indeed, that is one of our main points: the needs of different businesses and facilities vary so much—and conditions vary so much
between metro areas even in the same state—that the whole concept of a state ‘business climate’ is nonsensical. For only the third time in 27 years, the pseudo-social science of ‘business climate’ ratings has been debunked. We should lay aside these useless reports and debate the real issue: how to build a tax system that is fair, modern and relevant.”