For over a decade the Heritage Foundation and the Wall Street Journal have tracked the economic freedom of nations around the world. In their words,
Economic freedom is the fundamental right of every human to control his or her own labor and property. In an economically free society, individuals are free to work, produce, consume, and invest in any way they please, with that freedom both protected by the state and unconstrained by the state. In economically free societies, governments allow labor, capital and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself.
In other words, this index measures the level of freedom within a nation’s economy, such as business, trade, fiscal, labor, government spending, monetary, investment, financial, property rights, and freedom from corruption. Rankings are dependent upon a nation’s ability to deliver on these freedoms.
Some interesting results this year:
- for the first time in 16 years, the US does not qualify as a free economy (‘free’ being the top level of this measure). The biggest causes for this are related to an increase in government regulations, trade restrictions, and government spending,
- Hong Kong continues its sixteen-year reign as the freest economy in the world
- Singapore, Australia and New Zealand are 2nd, 3rd, and 4th
Why is this important? In the years it has tracked economic freedoms, the group has found there is a direct correlation between free economies and prosperous economies. And prosperity correlates to the well-being of citizens.
Want to see who the happiest people in the world are. Check out this post.