Capitalism and Freedom?

Posted: 6 Mar 2010

Date Written: 2010


This essay tests Milton Friedman’s conjecture that capitalism is a necessary condition for political freedom. For the decade around 2000 indices of the degree of capitalism and the degree of political freedom are highly correlated and provide plausibility for Friedman’s conjecture. In looking at changes over time in the nineteenth century, however, the analysis refutes Friedman’s conjecture. These apparently contradictory results are reconciled by showing that both capitalism and freedom are related to such variables as the educational level of the population so that, although not causally tied, they are correlated in a cross-national comparison.

Keywords: Capitalism, Economic freedom, Political freedom

JEL Classification: P1, P16, P51, N1

Suggested Citation

Pryor, Frederic L., Capitalism and Freedom? (2010). Economic Systems, Vol. 34, No. 1, 2010, Available at SSRN:

Frederic L. Pryor (Contact Author)

Swarthmore College ( email )

500 College Ave
Swarthmore, PA 19081
United States

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