investing

6 states with best GDP growth since 2007

Nebraska
Nebraska © Weldon Schloneger/Shutterstock.com
  • 2007 GDP: $82.1 billion
  • 2011 GDP: $96.2 billion
  • Growth: 17.16 percent

The Cornhusker State's economy has long been dominated by (you guessed it) corn. Between 2007 and 2011, in fact, about 22 cents of every dollar in the state's economy came from Nebraska's vast corn fields and farms.

Corn remains a dominant component of the state's economy because of the country's push to embrace corn-based ethanol as an alternative to fossil fuels.

"Really, ethanol has been a big part of the demand for corn," Roger Wilson, an economist at the University of Nebraska-Lincoln's Institute of Agriculture & Natural Resources.

Since 2005, when the federal government mandated that gasoline contain ethanol, corn prices have tripled from $2 to $6 per bushel from the 2005-2006 market year to the 2011-2012 market year, according to the U.S. Department of Agriculture. And with more irrigated farmland than any other state, Nebraska is well-equipped to supply crops to the rest of the U.S.

The demand for corn also has pushed up prices for other crops, Wilson says. "If corn seems to be more profitable, more land is used for it. It means less land for other crops," he says. "And if the supply of those crops goes down, the price goes up."

Sectors contributing majority of growth:

  • Agriculture, forestry, fishing and hunting (mostly farming)
  • Manufacturing (especially machinery and chemicals)
  • Government (mostly state and local)

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