The Path of Liberalization and Economic Growth

23 Pages Posted: 12 Dec 2002


Empirical research has shown that both more economic freedom and a higher stability of policy variables are supportive for economic growth. Thus, the path of policy liberalization may have a considerable influence on a nation's growth performance. Using the Fraser-index of economic freedom, this article shows empirically that policy volatility proves to be growth depressing, even if the state liberalizes the economy in the long-run. Growth is significantly higher if liberalization occurs on a smoother path.

Suggested Citation

Pitlik, Hans, The Path of Liberalization and Economic Growth. Available at SSRN:

Hans Pitlik (Contact Author)

Universitaet Hohenheim ( email )

70593 Stuttgart

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