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Economic Freedom of the World
The foundations of economic freedom are personal choice, voluntary exchange, and open markets. As Adam Smith, Milton Friedman, and Friedrich Hayek have stressed, freedom of exchange and market coordination provide the fuel for economic progress. Without exchange and entrepreneurial activity coordinated through markets, modern living standards would be impossible.
Potentially advantageous exchanges do not always occur. Their realization is dependent on the presence of sound money, rule of law, and security of property rights, among other factors. Economic Freedom of the World seeks to measure the consistency of the institutions and policies of various countries with voluntary exchange and the other dimensions of economic freedom. The report is copublished by the Cato Institute, the Fraser Institute in Canada and more than 70 think tanks around the world.
View an interactive map of economic freedom
Economic Freedom of the World: 2008 Annual Report
By James Gwartney and Robert Lawson with Seth Norton |
 A global effort has been devoted to reducing world poverty. Some claim poverty can be best combated by foreign aid. Others point to the importance of domestic policies, such as those that support or weaken economic freedom. In new research published in this year’s report, Seth Norton and James Gwartney investigate the connection between economic freedom and poverty. Using various measures of poverty, Norton and Gwartney find a strong positive relationship between economic freedom and poverty reduction and call for more research in this area. This year's report notes that economic freedom remains on the rise. The average economic freedom score rose from 5.46 (out of 10) in 1980 to 6.65 in the most recent year for which data are available. Of the 102 nations with chain-linked scores going back to 1980, 89 saw an improved score and 13 saw a decrease. In this year’s index, Hong Kong retains the highest rating for economic freedom, 8.94 out of 10, followed by Singapore, New Zealand, Switzerland, United Kingdom, Chile, Canada, United States, Australia, and Ireland. The first Economic Freedom of the World Report, published in 1996, was the result of a decade of research by a team which included several Nobel Laureates and over 60 other leading scholars in a broad range of fields, from economics to political science, and from law to philosophy. This is the 12th edition of Economic Freedom of the World and this year's publication ranks 141 nations for 2006, the most recent year for which data are available.
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Economic Freedom of the World: 2007 Annual Report
By James Gwartney and Robert Lawson with Russel S. Sobell and Peter T. Leeson |
Is capitalism contagious? If so, to what extent; and how does it spread? In new research published in this year’s report, Russell S. Sobel and Peter T. Leeson examine these questions empirically. They find that economic freedom does in fact spread, although not as strongly as might be suggested by the emphasis this idea has been given in US foreign policy. In the report, Sobel and Leeson discuss the implications of these results for foreign policy and offers some predictions about the future path, and spread, of global economic freedom. This year's report notes that economic freedom remains on the rise. The average economic freedom score rose from 5.1 (out of 10) in 1980 to 6.6 in the most recent year for which data are available. Of the 102 nations with scores in 1980 and in the most recent index, 90 recorded improvements in their economic freedom score, and just nine saw a decline. In this year's index, Hong Kong retains the highest rating for economic freedom, 8.9 out of 10, followed by Singapore, New Zealand, Switzerland, Canada, United Kingdom, and the United States. Press Release Contents: Table of Contents and Acknowledgments [pdf, 222Kb] Executive Summary [pdf, 85Kb] Chapter 1 [pdf, 838Kb] Chapter 2 [pdf, 305Kb] Chapter 3, Country Data A through K [pdf, 398Kb] Chapter 3, Country Data L through Z [pdf, 412Kb] Appendix 1 [pdf, 160Kb] Appendix 2 [pdf, 154Kb] |
Economic Freedom of the World: 2006 Annual Report
By James Gwartney and Robert Lawson with William Easterly |
The United Nations and other bodies have called for more foreign aid to help lift developing nations out of poverty. Yet in new research published in this year’s report, William Easterly, an economist from New York University, finds that economic freedom has a strong and positive impact on growth, and that foreign aid does not. He dispels the notion of a "poverty trap" and shows that poor countries with more economic freedom grow faster than rich countries This year's report notes that economic freedom remains on the rise. The average economic freedom score rose from 5.1 (out of 10) in 1980 to 6.5 in the most recent year for which data are available. Of the 102 nations with scores in 1980 and in the most recent index, 98 recorded improvements in their economic freedom score, four saw a decline. In this year's index, Hong Kong retains the highest rating for economic freedom, 8.7 out of 10, followed by Singapore at 8.5. New Zealand, Switzerland, and the United States tied for third with ratings of 8.2. Ireland and the United Kingdom are tied for 6th at 8.1. Canada ranked 8th with a rating of 8.0. Iceland and Luxembourg are tied for 9th at 7.9. Press Release Contents: Table of Contents and Acknowledgments [pdf, 243Kb] Executive Summary [pdf, 79Kb] Chapter 1 [pdf, 644Kb] Chapter 2 [pdf, 273Kb] Chapter 3, Country Data A through K [pdf, 274Kb] Chapter 3, Country Data L through Z [pdf, 247Kb] Appendix 1 [pdf, 162Kb] Appendix 2 [pdf, 148Kb] |
Economic Freedom of the World: 2005 Annual Report
By James Gwartney and Robert A. Lawson with Erik Gartzke |
Economic freedom is almost 50 times more effective than democracy in restraining nations from going to war. In new research published in this year’s report, Erik Gartzke, a political scientist from Columbia University, compares the impact of economic freedom on peace to that of democracy. When measures of both economic freedom and democracy are included in a statistical study, economic freedom is about 50 times more effective than democracy in diminishing violent conflict. The impact of economic freedom on whether states fight or have a military dispute is highly significant while democracy is not a statistically significant predictor of conflict. This year’s report notes that economic freedom remains on the rise. The average economic freedom score rose from 5.2 (out of 10) in 1985 to 6.4 in the most recent year for which data are available. In this year’s index, Hong Kong retains the highest rating for economic freedom, 8.7 of 10, closely followed by Singapore at 8.5. New Zealand, Switzerland, and the United States tied for third with ratings of 8.2. The United Kingdom, Canada, and Ireland ranked 6th, 7th, and 8th, respectively. Australia, Estonia, Luxembourg, and the United Arab Emirates tied for 9th. Contents: Table of Contents and Acknowledgments [pdf, 243Kb] Executive Summary [pdf, 79Kb] Chapter 1 [pdf, 644Kb] Chapter 2 [pdf, 273Kb] Chapter 3, Country Data A through C [pdf, 274Kb] Chapter 3, Country Data D through J [pdf, 247Kb] Chapter 3, Country Data K through P [pdf, 270Kb] Chapter 3, Country Data R through Z [pdf, 269Kb] Appendix 1 [pdf, 162Kb] Appendix 2 [pdf, 148Kb] |
Economic Freedom of the World: 2004 Annual Report
By James Gwartney and Robert Lawson |
 Economic freedom is strongly related to prosperity and growth. Countries that are economically free tend to grow faster and be more prosperous. New research in the 2004 report finds that economically free nations attract nearly $11,000 of investment per worker, 12 times more than the $847 investment per worker in unfree economies. Moreover, the productivity of investment is 70 percent greater in economically free nations than in unfree nations. Nations in the top fifth of economic freedom have an average per capita income of $26,100 compared to $2,800 for nations in the bottom fifth. Economic freedom benefits the lives of all people including the poor. In nations in the top fifth of economic freedom, the average income of the poorest 10 percent of the population was $6,877 compared to just $823 in the least free nations. Contents: Table of Contents and Acknowledgments Executive Summary [pdf, 53Kb] Chapter 1 [pdf, 520Kb] Chapter 2 [pdf, 290Kb] Chapter 3, Country Data A through C [pdf, 256Kb] Chapter 3, Country Data D through J [pdf, 227Kb] Chapter 3, Country Data K through P [pdf, 228Kb] Chapter 3, Country Data R through Z [pdf, 230Kb] Appendix 1 [pdf, 126Kb] Appendix 2 [pdf, 123Kb]  Read Treasury Undersecretary John B. Taylor's comments on the report. Read the Associated Press report: Hong Kong Tops Economic Freedom List
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Economic Freedom of the World: 2003 Annual Report
By James Gwartney and Robert Lawson |
Contents: Table of Contents and Acknowledgments [pdf, 211Kb] Executive Summary [pdf, 96Kb] Chapter 1 [pdf, 337Kb] Chapter 2 [pdf, 180Kb] Chapter 3, Country Data A through C [pdf, 297Kb] Chapter 3, Country Data D through J [pdf, 232Kb] Chapter 3, Country Data K through P [pdf, 236Kb] Chapter 3, Country Data R through Z [pdf, 236Kb] |
Economic Freedom of the World: 2002 Annual Report
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Contents: Table of Contents, Acknowledgments, and Executive Summary [pdf, 291Kb] Chapter 1 [pdf, 331Kb] Chapter 2 [pdf, 162Kb] Chapter 3 [pdf, 265Kb] Chapter 4 Country Data A through C [pdf, 315Kb] Chapter 4 Country Data D through J [pdf, 239Kb] Chapter 4 Country Data K through P [pdf, 243Kb] Chapter 4 Country Data R through Z [pdf, 244Kb] |
| By James Gwartney and Robert Lawson, with Chris Edwards, Walter Park, Veronique de Rugy and Smita Wagh |
Economic Freedom of the World: 2001 Annual Report
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Contents: Table of Contents, Acknowledgments, and Executive Summary [pdf, 116Kb] Chapter 1 [pdf, 162Kb] Chapter 2 [pdf, 161Kb] Chapter 2 Tables [pdf, 114Kb] Chapter 3 [pdf, 158Kb] Chapter 3 Tables [pdf, 63Kb] Chapter 4 [pdf, 198Kb] Chapter 5 [pdf, 22Kb] Chapter 5 Tables [pdf, 575Kb] |
| By James Gwartney and Robert Lawson with Walter Park and Charles Skipton |
The data from Economic Freedom of the World is available for download free-of-charge at Freetheworld.com.
Special software that brings the EFW report data and the 2004 World Bank Development Indicators is also available at Globaleconomicsoftware.com.
Read other books and studies from Cato on economic freedom.