Economic Freedom of the World 2009 Annual Report

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Countries with more economic freedom have substantially higher per-capita incomes.

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The share of income earned by the poorest 10% of the population is unrelated to the degree of economic freedom in a nation.

The Fraser institute defines and collects the “Economic Freedom of the World” (EFW) index every year. Just like other complicated indexes, it is imperfect, but it attempts to factor in the many dimensions of economic freedom (personal choice, voluntary exchange, protection of private property, etc.).

Their annual report ranks countries by the EFW index and analyzes other metrics (such as GDP, income per capita and longevity) in relation to this index.
The data shows a clear correlation between freedom and GDP per capita, ie. countries with more economic freedom are richer. Similarly, people live longer in those freer countries.
Those are positive results and reflects the lessons learned from this century, that central planning makes people worse off and the free market makes people better off.

The report also addresses a common concern: no, the poor are not worse off in free economies. The income share for the 10% poorest remains around 2.5%, both in less and more free countires. Actually, they fare better in actual income in free economies (which are richer), still getting a small share, but out of a larger pie.

Check out the latest report in its entirety. It also looks at trends, environmental performance, corruption and civil liberties.



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