We're Number 11, We're Number 11! Eh?
By David Henderson
The Cato Institute, the Fraser Institute, and more than 70 think tanks around the world have published the latest edition of Economic Freedom of the World. It’s by James Gwartney, Robert Lawson, and Joshua Hall, with the assistance of Ryan Murphy, and contributions from Rosemarie Fike, Richard J. Grant, Fred McMahon, Indra de Soysa, Krishna Chaitanya Vadlamannati. They publish an update every year.
The authors and researchers look at five categories to judge the degree of economic freedom in 159 countries and territories. The latest data are from 2015.
Check this link from the Fraser Institute to see the top 10 countries.
Canada and the United States are tied for number 11 at a score of 7.94 out of 10. That’s bad news for Canada; last year it was #5 with a score of 7.98, admittedly a small decline. It’s good news for the United States; last year is was 7.75. That seems like a large increase relative to my casual look at the United States. Where does the 0.19 increase come from?
Here are the categories and scores. The scale goes from 1 to 10. The data below are from the 2016 and 2017 reports, which means they are data from 2014 and 2015 respectively.
Size of government: Stayed constant at 6.4.
Legal system and property rights: Rose slightly from 7.1 to 7.2.
Sound money: Rose from 9.4 to 9.8.
Freedom to trade internationally: Fell slightly from 7.6 to 7.5.
Regulation: Rose from 8.3 to 8.8.
Under the Regulation category, there are 3 sub-categories. Here they are with the scores.
Credit market regulation: Rose from 9.0 to 9.3.
Labor market regulation: Rose from 9.2 to 9.3.
Business regulation: Rose a lot from 6.6 to 7.7.