Advantages Of Economic Freedom

Economics Freedom

Economics freedom can be best defined as the freedom of an individual to prosper within a country/state without the intervention from government or economic authorities relating to the individuals human resources, labor or private properties. Economics Freedom can be best utilized/seen in a capitalist economy due to it 's numerous advantages which surpasses those of a socialist economy, also according to Freidrich Hayek in his book the road to serfdom, mentions that the economic freedom of capitalism is a requisite of political freedom, therefore stating that there cannot be economic freedom without the issue of political freedom.He tries to pass on his point saying that the market mechanism is the only way to produce and

The annual surveys economic freedom of the world (EFW) and Index of economic freedom (IEF) are two indices which measure the degree of economic freedom in the world 's nations. The EFW index, initially developed by Gwartney, Lawson and Block was likely the most used in empirical studies as of 2000. The other most extensively used index which was created by the heritage foundation and the wall street journal seemed to be better for data analysis but was not as useful when it came to historical comparisons. According to the individuals that created the use of economic indices, the rankings have a mutual relationship with the greater average income per person, higher income of the poorest ten percent, higher life expectancy, higher literacy rates, lower infant mortality rates, higher access to good and clean water sources and less corruption. The people living in the top one-fifth of countries enjoy an average income of $23,450 and a growth rate in the 1990s of 2.56 percent per year; in contrast, the bottom one-fifth in the rankings had an average income of just $2,556 and a -0.85 percent growth rate in the 1990s. The poorest ten percent of the population have an average income of just $728 in the lowest ranked countries compared with over $7,000 in the highest ranked countries. The life expectancy of people living in the highest ranked nations is 20 years longer than for people in the lowest ranked countries. Higher economic freedom, as measured by both the Heritage and the Lawson and Block 's method of measuring the indices, correlates strongly with higher self-reported happiness. Erik Gartzke of the Fraser institute( institute that Lawson and Block are associated to) estimates that countries with a high EFW are significantly less likely to be involved in wars, while his measure of democracy had little or no impact.