Overwhelmed by all those ratings, rankings and lists? Advice on being a smart consumer of information.

• Author: Mcgiveran-Bohan, Kellie

Most of us do not go a day without seeing some sort of ranking or rating list in the news or social media. We can find a list to compare just about anything. For example, U.S. News and World Report's college rankings can help us make a complicated choice like what school to attend--a big decision with lots of consequences. Others, like a list of the city's best restaurants, help us choose where to go for dinner tonight. Yes, rankings and lists can definitely be useful.

They help us make quick decisions because they take tons of measures and data and boil it down into one easy to understand number (Ovadia, 2004). Say you're considering getting an MBA. Most of us don't have the time to find and compare every little aspect-the graduation rates and starting salaries, GMAT/GRE scores, acceptance rate, undergrad GPA, etc. Besides, could we even get to that information? Or say you want to eat dinner out? We often turn to crowd-sourced rankings (e.g., Yelp) or expert evaluations (e.g., a food critic column).

But while ratings put a wealth of information at our fingertips, not all have the same implications for our lives. When we choose a college, we're making a decision that potentially affects the rest of our career, demands thousands of hours and costs tens of thousands of dollars. In contrast, selecting a restaurant has similar implications, but on a much tinier scale (e.g., less than a day, time spent at the venue and meal cost).

These personal decisions give some insights into understanding and using state ratings. Specifically, think about location rankings. In some cases, we might use them just to brag about our city. In other cases, some influence huge and wide-reaching policies! These affect businesses by telling them the best place to put their next location. When a city is low on a list, rankings can influence big budget decisions, like how much money to put into business infrastructure-roads, utilities, tax breaks and so on.

Below is a short list of popular state rankings, specifically the ones Indiana currently points to in promoting our top placements:

* Chief Executive Magazine: Best and worst states for business

* Business Facilities Magazine: Best states

* CNBC America: Top states for business

* Standard & Poor's: Bond ratings

* The Pacific Research Institute: The 50-State Small Business Regulation Index

* The Tax Foundation: State Business Tax Climate Index

* Forbes: Best states for business

How do you use what list for what decision? We at the Indiana Business Research Center aim to help you be a discerning consumer by asking some simple questions about any rating or ranking system (see Figure 1).

What is the ranking?

This seems like a dumb question, but it's really a fundamental one. State best/worst rankings each have their own features to...