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Whcich Economic Freedoms Contribute to Growth?
Author(s) -
Heckelman Jac C.,
Stroup Michael D.
Publication year - 2000
Publication title -
kyklos
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 58
eISSN - 1467-6435
pISSN - 0023-5962
DOI - 10.1111/1467-6435.00132
Subject(s) - citation , state (computer science) , library science , history , sociology , political science , algorithm , computer science
The literature on economic freedom and growth has utilized summary measures of freedom to determine its general significance for economic growth. We believe the summary measures lead to misspecification problems. We utilize Heston-Summers growth data to determine which of the disaggregated categories of economic freedom lead to growth and find that only a few of the indexes significantly affect growth. These growth regressions generate new weights for aggregating the indexes into an overall summary measure. This new measure can be interpreted as deriving a relative ranking of nations that have a relatively higher presence of growth promoting economic freedoms and more restrictions on those economic freedoms that inhibit growth. Copyright 2000 by WWZ and Helbing & Lichtenhahn Verlag AG