Economic Freedom of the World
By James Gwartney, Robert Lawson, and Joshua Hall, and contributions fromRyan Murphy, Hans Pitlik, Dulce M. Redín, and Martin Rode.
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: 2015 Annual Report
Global economic freedom increased slightly in this year’s report, but remains below its peak level of 6.92 in 2007. The average score increased to 6.86 in 2013, the most recent year for which data is available.
In this year’s index,
- Hong Kong retains the highest rating for economic freedom, 8.97 out of 10.
The rest of this year’s top scores are
- Singapore, 8.52;
- New Zealand, 8.19;
- Switzerland, 8.16;
- United Arab Emirates, 8.15;
- Mauritius, 8.08;
- Jordan, 7.93;
- Ireland, 7.90;
- Canada, 7.89; and the
- United Kingdom and Chile at 7.87.
The United States, once considered a bastion of economic freedom, now ranks 16th in the world with a score of 7.73. Due to a weakening rule of law, increasing regulation, and the ramifications of wars on terrorism and drugs, the United States has seen its economic freedom score plummet in recent years, compared to 2000 when it ranked second globally.
The rankings of other large economies in this year’s index are
- Japan (26th),
- Germany (29th),
- South Korea (39th),
- Italy (68th),
- France (70th),
- Mexico (93st),
- Russia (99th),
- China (111th),
- India (114th), and
- Brazil (118th).
Nations in the top quartile of economic freedom had an average per capita GDP of US$38,601 in 2013, compared to US$6,986 for bottom quartile nations. Moreover, the average income of the poorest 10% in the most economically free nations is about 50% greater than the overall average income in the least free nations. Life expectancy is 80.1 years in the top quartile compared to 63.1 years in the bottom quartile, and political and civil liberties are considerably higher in economically free nations than in unfree nations.
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 19th edition of Economic Freedom of the World and this year’s publication ranks 157 nations for 2013, the most recent year for which data are available.
Table of Contents [pdf, 437Kb]
Executive Summary [pdf, 482Kb]
Chapter 1 [pdf, 897Kb]
Chapter 2, Country Data Tables [pdf, 1.18Mb]
Chapter 3 [pdf, 905Kb]
Appendix [pdf, 536Kb]
Acknowledgments [pdf, 609Kb]
*The content linked above reflects some slight recalculations since the report’s initial printing.