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Institutions, Economic Freedom, and Cross‐Country Differences in Performance

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  • James Gwartney

Abstract

This address describes the history of the Economic Freedom of the World (EFW) project and the development of the EFW index. This index is a measure of the extent to which the institutions and policies of various countries are coordinated by personal choice, voluntary exchange, open markets, and clearly defined and enforced property rights. The index contains 42 different components and is currently available for 141 countries. Data for approximately 100 countries are available back to 1980. The EFW index incorporates many of the elements that new institutional economists argue are important sources of growth. Thus, it facilitates empirical investigation of the institutional theory of growth and crosscountry comparisons of economic performance. In this regard, the paper considers 10 propositions that have been addressed with the index, and what has been learned from this analysis.

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  • James Gwartney, 2009. "Institutions, Economic Freedom, and Cross‐Country Differences in Performance," Southern Economic Journal, John Wiley & Sons, vol. 75(4), pages 937-956, April.
    • Handle: RePEc:wly:soecon:v:75:y:2009:i:4:p:937-956
    DOI: 10.1002/j.2325-8012.2009.tb00941.x
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    8. Dawson, John W, 1998. "Institutions, Investment, and Growth: New Cross-Country and Panel Data Evidence," Economic Inquiry, Western Economic Association International, vol. 36(4), pages 603-619, October.
    9. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 28241, December.
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    Cited by:

    1. Murphy, Ryan H., 2020. "The Quality of Legal Systems and Property Rights by State: A Ranking and Their Implications for Economic Freedom," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 50(1), April.

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