Economic Freedom of the World

Economics, Liberty by Adam on 2005-11-18 07:23

The Cato Institute is a libertarian think-tank which puts to work some of the brightest political minds of our time on the task of analyzing policy and seeking pragmatic solutions to issues facing America and the entire world. Putting the same thing another way, these guys fucking rock.

Besides their excellent paper publications (books, magazines, etc), I especially recommend Cato Audio, a monthly talk radio show they send out on CD, or purchasable as an mp3 download.

One of their most powerful publications is the annual Economic Freedom of the World report. The ranking of nations can be found on page 12 of the chapter 1 PDF. To give you a taste, Hong Kong rates at the top, besting the next contender, Singapore, by a full two points. Under that can be found New Zealand, Switzerland, the US, and the UK all coming in about even.

The unfortunate bottom of the list includes a number of African countries, Venezuela, and the very regrettable case of Myanmar (formerly Burma) which falls last on the list, a full five points behind the next up.

Beyond the scorecard, the report goes into great detail on how the scores were arrived at (a comprehensive list of key freedoms each make their contribution) and includes a great deal of analysis. For me the most interesting part of this is discussion of how freedom and peace go hand in hand. In particular, economic freedom - not usually considered by most to be as important as political freedom (i.e., democracy) - is very highly correlated with peace.

In fact, there is very little evidence to support the oft-mentioned justification for invading Iraq: that installing democracy to the Middle East will produce peace. If peace is the stated goal of the invasion, then economic freedom should be the focus on the new regime, not democracy. (Of course democracy and economic freedom very often go hand-in-hand, so this is not to say that democracy should not be part of the equation; just not its focus, if peace in that area is the primary goal.)

The Cato Economic Freedom of the World report is a handbook for any government or individual leader who wishes to improve the prosperity, health, and happiness of their people. It’s worth checking out even if you don’t happen to be a high-ranking national official for a small impoverished country seeking to improve its lot.

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