Is capitalism contagious? Since WWI, global foreign policy has treated economic freedom/repression like a virus that spreads between countries. Most recently, the ?domino theory? of freedom has played prominently in U.S. foreign policy toward Asia, Latin America, and the Caribbean during the Cold War, and the Middle East during the War on Terror. This paper investigates the spread of economic freedom between nations. Our analysis considers two potential channels of this spread: geography and trade. We estimate two models of spatial dependence using panel data that cover more than 100 countries between 1985 and 2000. We ?nd that capitalism is in fact contagious. Countries consistently ?catch?about 20 percent of their average geographic neighbors?and trading partners?levels and changes in economic freedom. We also explore American foreign military intervention?s ability to spread economic freedom abroad. We ?nd that although intervention may increase freedom in U.S. occupied countries, this freedom is not contagious. Using our estimates of freedom?s spread when it is contagious, we simulate the impact of successful Iraqi occupation on Middle Eastern freedom. Even under the most favorable assumptions, we ?nd that U.S. occupation would minimally improve freedom in this region.
|Date of creation:||2006|
|Contact details of provider:|| Postal: P.O. Box 6025, Morgantown, WV 26506-6025|
Phone: (304) 293-7859
Fax: (304) 293-2233
Web page: http://business.wvu.edu/graduate-degrees/phd-economics
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dani Rodrik & Arvind Subramanian & Francesco Trebbi, 2002.
"Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development,"
NBER Working Papers
9305, National Bureau of Economic Research, Inc.
- Dani Rodrik & Arvind Subramanian & Francesco Trebbi, 2004. "Institutions Rule: The Primacy of Institutions Over Geography and Integration in Economic Development," Journal of Economic Growth, Springer, vol. 9(2), pages 131-165, 06.
- Rodrik, Dani & Subramanian, Arvind & Trebbi, Francesco, 2002. "Institutions Rule: The Primacy of Institutions Over Geography and Integration in Economic Development," CEPR Discussion Papers 3643, C.E.P.R. Discussion Papers.
- Peter J. Boettke & Christopher J. Coyne & Peter T. Leeson, 2015.
"Institutional stickiness and the New Development Economics,"
in: Culture and Economic Action, chapter 6, pages 123-146
Edward Elgar Publishing.
- Peter J. Boettke & Christopher J. Coyne & Peter T. Leeson, 2008. "Institutional Stickiness and the New Development Economics," American Journal of Economics and Sociology, Wiley Blackwell, vol. 67(2), pages 331-358, 04.
- Tomi Ovaska & Russell S. Sobel, 2005. "Entrepreneurship in Post-Socialist Economies," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 21(Fall 2005), pages 8-28.
- Douglass C. North, 2005. "Introduction to Understanding the Process of Economic Change," Introductory Chapters, in: Understanding the Process of Economic Change Princeton University Press.
- Hayek, F. A., 1996. "Individualism and Economic Order," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226320939.
- Scully, Gerald W, 1988. "The Institutional Framework and Economic Development," Journal of Political Economy, University of Chicago Press, vol. 96(3), pages 652-662, June.
- repec:cto:journl:v:18:y:1998:i:2:p: is not listed on IDEAS
- James D. Gwartney & Robert A. Lawson & Randall G. Holcombe, 1999. "Economic Freedom and the Environment for Economic Growth," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 155(4), pages 643-, December.
- Christopher J. Coyne & Peter T. Leeson, 2004. "Read All About It! Understanding the Role of Media in Economic Development," Kyklos, Wiley Blackwell, vol. 57(1), pages 21-44, 02.
- Seth W. Norton, 1998. "Poverty, Property Rights, and Human Well-Being: A Cross-National Study," Cato Journal, Cato Journal, Cato Institute, vol. 18(2), pages 233-245, Fall.
- Christopher J. Coyne & Peter T. Leeson, 2004. "The Plight of Underdeveloped Countries," Cato Journal, Cato Journal, Cato Institute, vol. 24(3), pages 235-249, Fall.
When requesting a correction, please mention this item's handle: RePEc:wvu:wpaper:06-04. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Josh Hall)
If references are entirely missing, you can add them using this form.