Economic Freedom of the World: An Accounting of the Literature

19 Pages Posted: 20 Nov 2013  

Joshua C. Hall

West Virginia University

Robert A. Lawson

Capital University - Department of Economics

Date Written: January 2014

Abstract

The Economic Freedom of the World (EFW) index was first produced by Gwartney, Block, and Lawson (Economic Freedom of the World: 1975–1995; 1996) 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 Classification: P0, O43

Suggested Citation

Hall, Joshua C. and Lawson, Robert A., Economic Freedom of the World: An Accounting of the Literature (January 2014). Contemporary Economic Policy, Vol. 32, Issue 1, pp. 1-19, 2014. Available at SSRN: https://ssrn.com/abstract=2357206 or http://dx.doi.org/10.1111/coep.12010

Joshua C. Hall (Contact Author)

West Virginia University ( email )

Morgantown, WV 26506
United States

Robert A. Lawson

Capital University - Department of Economics ( email )

303 E. Broad St.
Columbus, OH 43215-3200
United States
614-236-6138 (Phone)
614-236-6540 (Fax)

HOME PAGE: http://capital2.capital.edu/faculty/rlawson/

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