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Decomposed Effects of Democracy on Economic Freedom

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  • Lundström, Susanna

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

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    Abstract

    Many previous empirical studies conclude that democracy increases economic freedom. However, these studies use highly aggregated indices of economic freedom, which eliminate interesting information and obstruct policy conclusions. The purpose of this study is to empirically study how different categories of economic freedom are affected by democracy in developing countries. There seems to be a positive effect of democracy on the categories Government Operations and Regulations and Restraints on International Exchange, but for the categories Money and Inflation and Takings and Discriminatory Taxation there is no effect. The robustness to extreme points and the model specification is tested.

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    File URL: http://hdl.handle.net/2077/2671
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    Bibliographic Info

    Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 74.

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    Length: 23 pages
    Date of creation: 07 Jun 2002
    Date of revision:
    Handle: RePEc:hhs:gunwpe:0074

    Contact details of provider:
    Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
    Phone: 031-773 10 00
    Web page: http://www.handels.gu.se/econ/
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    Keywords: democracy; economic freedom; decomposition;

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    Cited by:
    1. Madeeha Gohar Qureshi & Eatzaz Ahmed, 2012. "The Inter-linkages between Democracy and Per Capita GDP Growth: A Cross Country Analysis," PIDE-Working Papers 2012:85, Pakistan Institute of Development Economics.

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