Halide ligand effects have been studied for the olefin insertion reaction into second row transition metal-hydrogen bonds, The specific effect of the halide is identified by comparing the insertion reaction for MH2 and MHX, where X is a chlorine or a fluorine atom. In this comparison the exchange and promotion effects are effectively cancelled. There is a dramatic lowering effect of 20 kcal/mol on the olefin insertion barrier for the metals to the right in the Periodic Table when halide ligands are present. In contrast, exchanging hydride and halide ligands for the metals to the left has almost no effect on the reaction. The large effect to the right is explained by a larger contribution of the s0-state of the metal when there are halide ligands. The barrier-determining effect is the repulsion between the olefin and the non-bonding electrons of the metal, and the s0 state is less repulsive than the s1-state. When a halide is bound to the metal the metal becomes more cationic to the right, and the ground states of the naked metal cations to the right are s0-states. When hydrides are the only ligands the metal becomes more neutral, and the ground states of the naked neutral atoms to the right are in most cases s1-states.