Economic Freedom of the World: An Accounting of the Literature

Abstract

and has been updated annually since. During this period, the EFW index has been cited in hundreds of academic articles. Here, we provide an accounting and description of this literature. Of 402 articles citing the EFW index, 198 used the index as an independent variable in an empirical study. Over two-thirds of these studies found economic freedom to correspond to a "good" outcome such as faster growth, better living standards, more happiness, etc. Less than 4% of the sample found economic freedom to be associated with a "bad" outcome such as increased income inequality. The balance of evidence is overwhelming that economic freedom corresponds with a wide variety of positive outcomes with almost no negative tradeoffs. (JEL P0, O43)

Economic Freedom, Income Inequality and Life Satisfaction in OECD Countries

“…This is also the case with Hall and Lawson (2014), who made an overview of empirical studies using the Economic Freedom Index of Fraser Institute. They found that over two-thirds of 198 studies found a positive impact of economic freedom on well-being, while only 4% found a negative impact.…”

Misperceptions about capitalism, government and inequality

“…The vast majority of cross-country empirical studies have linked economic freedom to positive outcomes (Hall and Lawson, 2014). The studies by Bennett, Boylan and Cebula in Chapter 9 and Cebula in Chapter 11 further affirm this.…”

Modelling Economic Growth Based on Economic Freedom and Social Progress

“…Faria and Montesinos (2009) found a "robust association between economic freedom and prosperity". In their literature review on this subject using the Economic Freedom of the World index, Hall and Lawson (2014) indicate that over two-thirds of the existing studies found that economic freedom is related to positive outcomes such as faster growth, better living standards, and more happiness. When examining the economic freedom and economic growth nexus in a panel of 28…”