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THE RELATIONSHIP BETWEEN ECONOMIC FREEDOM AND ECONOMIC DYNAMISM
Author(s) -
Barnatchez Keith,
Lester Robert
Publication year - 2017
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/coep.12194
Subject(s) - dynamism , economic freedom , index of economic freedom , economics , index (typography) , government (linguistics) , economic system , market economy , computer science , physics , quantum mechanics , linguistics , philosophy , world wide web
We analyze the consequences of economic freedom on economic dynamism across U.S. states and over time. Using data from the Economic Freedom of North America index, we show that states with greater economic freedom have higher rates of gross and net job creation and establishment entry. The results are robust to the inclusion of many different control variables and alternative specifications, suggesting a connection between freedom and dynamism. This evidence supports theories in which government policies may impede business dynamism. ( JEL 043, P16, R5)