Economic Freedom Of The World

Derives an indicator for economic freedom based on personal choice, protection of private property, and freedom of exchange. Considers levels and trends in economic freedom, and their correlation with economic growth in 103 countries.

Economic theory and a growing body of empirical research support the idea that economic freedom is an important ingredient to long-run economic prosperity. However, the determinants of economic freedom are much less understood than the benefits that freedom provides. Economic Freedom and Prosperity addresses this major gap in our knowledge. If private property and economic freedom are essential for achieving and maintaining a high standard of living, it is crucial to understand how improvements in these areas have been achieved and whether there are lessons that can be replicated in less free areas of the world today. In this edited collection, contributors investigate this research question through multiple methodologies. Beginning with three chapters that theoretically explore ways in which economic freedom might be better achieved, it then moves on to a series of empirical chapters that examine questions including the speed and permanence of reform, the deep long-run determinants of economic freedom, the relationship between voice and exit in impacting freedom, the role of crises in generating change, and immigration. Finally, the book considers the evolution of freedom in China, development economics, and international trade, and it concludes with a consideration of what is necessary to promote a humane liberalism consistent with economic freedom. Economic Freedom and Prosperity will be of great interest to all social scientists concerned with issues of institutional change. It will particularly appeal to those concerned with economic development and the determinants of an environment of economic freedom.

What are the keys to good economic policy? George P. Shultz and John B. Taylor draw from their several decades of experience at the forefront of national economic policy making to show how market fundamentals beat politically popular government interventions—be they from Democrats or Republicans—as a recipe for success. Choose Economic Freedom reconstructs debates from the 1960s and 1970s about the use of wage and price controls as tools of policy, showing how brilliant economists can hold diametrically opposed views about the wisdom of using government intervention to spur the economy. Speeches and documents from the era include a recently unearthed memo from Arthur Burns, Federal Reserve chair, in 1971, in which he argues in favor of controls. Under Burns's guidance and in the face of stubborn inflation, Nixon introduced wage and price guidelines and freezes. But over the long run, these became a drag on the economy and ultimately failed. It wasn't until the Reagan administration that these controls were reversed, resulting in a vibrant economy. The words of iconic economist Milton Friedman—whose "free to choose" ethos inspired the free-market revolution of the Reagan era—along with lessons Shultz and Taylor learned from the front lines, demonstrate that tried-and-true economic policy works.

About the Members of the Economic Freedom Network / 235 Economic Freedom of the World: 2010 Annual Report v Executive Summary Economic Freedom of the World The index published in Economic Freedom of the World measures the degree to which the policies and institutions of countries are supportive of economic freedom. [...] Chapter 1: Economic Freedom of the World, 2008 The principal authors of the report, James Gwartney (Florida State University), Robert Lawson (Auburn University), and Joshua Hall (Beloit College), review the causes of the financial crisis and the recession. [...] The authors also review the history of the economic freedom project and describe the construction of the index. [...] Given the large costs of unemployment and the enormous number of jobless people worldwide, particularly in the wake of the current financial and economic crisis, governments should consider increasing economic freedom as a means of reducing unemployment. [...] The length and severity of the Great 2 Chapter 1: Economic Freedom of the World, 2008 Depression were the result of a sharp monetary con- to use resources productively and discover better ways traction, imposition of trade restrictions, higher taxes, of doing things is the driving force underlying economic increases in government spending financed with debt, growth and progress.

The most comprehensive index of economic freedom in the world and the only one that uses reproducible measures appropriate for peer-reviewed research, this annual report ranks 123 countries according to the degree of personal choice, voluntary exchange, freedom to compete, and protection of person and property enjoyed by their citizens. The preparation of the report was overseen by the Fraser Institute and directed by economist Milton Friedman.