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The Effect of Geopolitical Region and Development Level on the Relationship Between Economic Freedom and Happiness

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  • Kutnyi, Oleh

Abstract

This study explores the nuanced relationship between economic freedom and happiness, investigating the influence of geopolitical regions and developmental stages on this association. Utilizing cross-sectional secondary data from 135 countries in 2021, this research employs a regression analysis incorporating economic freedom as the independent variable and happiness as the dependent variable. The model further includes interactions between economic freedom and both the geopolitical region and level of development. Initial findings affirm a positive correlation between economic freedom and happiness across countries. However, when considering interactions, distinct patterns emerge. Contrary to expectations, the impact of economic freedom on happiness does not significantly differ among countries at varying development stages. Conversely, geopolitical context emerges as a critical factor, notably highlighting the significance of economic freedom in fostering happiness within Western Europe compared to other regions.

Suggested Citation

  • Kutnyi, Oleh, 2023. "The Effect of Geopolitical Region and Development Level on the Relationship Between Economic Freedom and Happiness," MPRA Paper 119620, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:119620
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    References listed on IDEAS

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    1. Gehring, Kai, 2013. "Who Benefits from Economic Freedom? Unraveling the Effect of Economic Freedom on Subjective Well-Being," World Development, Elsevier, vol. 50(C), pages 74-90.
    2. Cebula, Richard J. & Clark, J.R. & Mixon, Franklin G., Jr., 2013. "The Impact of Economic Freedom on Per Capita Real GDP: A Study of OECD Nations," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 43(01).
    3. Bjørnskov, Christian & Dreher, Axel & Fischer, Justina A.V., 2010. "Formal institutions and subjective well-being: Revisiting the cross-country evidence," European Journal of Political Economy, Elsevier, vol. 26(4), pages 419-430, December.
    4. Carlsson, Fredrik & Lundstrom, Susanna, 2002. "Economic Freedom and Growth: Decomposing the Effects," Public Choice, Springer, vol. 112(3-4), pages 335-344, September.
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    Keywords

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    JEL classification:

    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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