America's Top States For Business

What Tennessee and Estonia have in common

Scott Cohn | CNBC Special Correspondent
Tallinn, Estonia
Nico Tondini | Getty Images

One of the most talked about aspects each year in our America's Top States for Business study is our Quality of Life category, which in 2014 ranked Hawaii at the top and Tennessee at the bottom. Now, an international organization is taking the conversation a step further with a new study comparing well-being in U.S. states with other regions around the world.

Conditions in Hawaii, the study says, are comparable to those in Greater London (clearly, weather is not one of the metrics), while life in Tennessee shares many characteristics with life in the former Soviet republic of Estonia.

"Our day-to-day experience of life is essentially local," says the report released Monday by the Paris-based Organization for Economic Cooperation and Development (OECD), which represents 34 industrialized nations including the United States. "Whether people can find a job, a good school for their children or adequate healthcare depends on where they live."

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Concerned that the national data the organization tracks—such as gross domestic product—fails to account for regional differences, researchers compared 362 regions across the OECD's member nations. The study divides the U.S. into all 50 states plus the District of Columbia.

While the study steers clear of ranking the states and regions for overall well-being, it scores them on a ten-point scale in each of nine categories: access to services, civic engagement, education, jobs, environment, income, health, safety and housing.

Tennessee's score of 2.8 in the health category is similar to Estonia's 2.2, and the state's 6.4 on jobs tracks the eastern European nation's 6.2. Hawaii and London turned in similar scores in health (8.8 for Hawaii and 8.4 for London), safety (8.0 versus 8.5) and housing (5.2 to 4.8).

A view over the financial district and St Paul's Cathedral towards the west of the city at sunrise in London.
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Even comparable regions can have big disparities, however. London scores a perfect 10 for access to services while Hawaii scores just 6.5. The state turns in a near-perfect 9.8 for environment, while environmentally-challenged London comes in at 6.3.

The relatively high standard of living in the U.S. shines through in the study as well. While the report ranks Tennessee 31st among the states for income, it nonetheless scores 8.6 out of a possible 10 points when compared to the rest of the world—and well above Estonia's 1.2 in the category.

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Other comparisons, according to the study:

· Residents in California, which scores well in income, education, health, and environment, enjoy similar conditions to people in the Basque region of Spain.

· Conditions in Louisiana, which scores well for environment but poorly for safety, are analogous to those in Australia's Northern Territory.

· Wisconsin, which turns in strong scores in housing and education, compares to the federal state of Saarland in western Germany.

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The study also finds major differences within countries, like the fact that residents in Hawaii can expect to live six years longer than people in Mississippi. Pointing out those types of disparities, researchers say, is a key aim of the project.

"Countries with larger regional disparities in education, health, jobs and key services register lower well-being outcomes at the national level," writes OECD Public Governance Director Rolf Alter in a foreword to the report.

The study also shows just how misleading statistics at the national level can be. For example, while the overall murder rate in the U.S. is roughly in line with the OECD average, the murder rates in Louisiana, Mississippi, New Mexico and the District of Columbia are nearly twice the OECD average.

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Researchers say they hope their findings will improve regional policy making.

"Policies to promote growth, jobs, equity and environmental sustainability have greater impact when they take into account the economic and social realities of where people live and work," the study says.