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Economic freedom reform: does culture matter?

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  • Moellman, Nicholas
  • Tarabar, Danko

Abstract

We analyse the role of culture in economic freedom reform and dispersion in an unbalanced panel of up to 80 countries, and in dyadic models with up to 3,003 unique country pairs. We find that a sense of individualism strengthens the effectiveness of democracy in promoting economic freedom within countries over 1950–2015, and that institutional distance between countries increases in their cultural distance, suggesting an important role of culture in determining long-run institutional equilibria. Our results are robust to a large variety of socio-economic controls, measures of institutions and measures of bilateral geographic, economic and demographic distances.

Suggested Citation

  • Moellman, Nicholas & Tarabar, Danko, 2022. "Economic freedom reform: does culture matter?," Journal of Institutional Economics, Cambridge University Press, vol. 18(1), pages 139-157, February.
    • Handle: RePEc:cup:jinsec:v:18:y:2022:i:1:p:139-157_9
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