Saxony and Bavaria are the strongholds of the location

Saxony knocks Bavaria off the top spot, Lower Saxony moves up the rankings, Saxony-Anhalt is particularly future-oriented, Rhineland-Palatinate lags behind. The results of the second Federal State Index compiled by the Family Business Foundation in cooperation with ZEW Mannheim are surprising in some respects. It aims to motivate learning and provide guidance on how to use the billions from the special fund.

Saxony and Bavaria are clearly at the top of the ranking, which combines a large number of individual indicators into five sub-indices: taxes, labour/human capital, financing, infrastructure and institutions. However, Saxony performs rather averagely in terms of taxes and institutions, while Bavaria is not particularly impressive in terms of infrastructure. Lower Saxony (third place) performs particularly well in this area. In contrast, Baden-Württemberg (fifth place) also shows weaknesses in infrastructure.

When it comes to infrastructure, one of the factors that plays a role is the electricity supply, which has higher grid fees in the south. Those who have boldly embarked on the digitalisation of public administration are rewarded with a good ranking in the institutions index, as is the case with North Rhine-Westphalia. The assessment is therefore complex, and not everything can be attributed to political decisions, as Prof. Dr Friedrich Heinemann, head of the ZEW Research Unit “Corporate Taxation and Public Finance”, emphasises.