Political Ideology and Economic Freedom Across Canadian Provinces

Centre Emile Bernheim Research Institue in Management Sciences Working Paper No. 09/054

36 Pages Posted: 16 Jan 2010 Last revised: 2 May 2010

See all articles by Niklas Potrafke

Niklas Potrafke

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Christian Bjørnskov

Aarhus University - Department of Economics and Business; Research Institute of Industrial Economics (IFN); Center for Political Studies; Institute for Corruption Studies

Date Written: December 16, 2009

Abstract

This paper examines how political ideology influenced economic freedom in the Canadian provinces. We analyze the dataset of economic freedom indicators compiled by the Fraser Institute in 10 Canadian provinces over the 1981-2005 period and introduce two different indices of political ideology: government and parliament ideology. The results suggest that government ideology influenced labor market reforms: market-oriented governments promoted liberalization of the labor market. Parliamentary ideology did not influence economic liberalization at all. This finding (1) identifies differences between leftist and rightwing governments concerning the role of government in the economy and (2) indicates that ideological polarization concerns governments but less parliamentary fractions in the Canadian provinces.

Keywords: economic freedom, taxation, regulations, ideology, panel data

JEL Classification: O51, P16, R11, R50

Suggested Citation

Potrafke, Niklas and Bjørnskov, Christian, Political Ideology and Economic Freedom Across Canadian Provinces (December 16, 2009). Centre Emile Bernheim Research Institue in Management Sciences Working Paper No. 09/054, Available at SSRN: https://ssrn.com/abstract=1537544 or http://dx.doi.org/10.2139/ssrn.1537544

Niklas Potrafke

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

Christian Bjørnskov (Contact Author)

Aarhus University - Department of Economics and Business ( email )

Fuglesangs Allé 4
Aarhus V, DK-8210
Denmark

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

Center for Political Studies

Landgreven 3
Copenhagen K, DK-1301
Denmark

Institute for Corruption Studies

Stevenson Hall 425
Normal, IL 61790-4200
United States

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