The good news is that the first 20 years of the millennium saw overall increases in economic freedom around the world—with continuous improvement through the second decade. The bad news is that not just the United States but most of the world lost ground during the massive government interventions of the COVID-19 pandemic. That’s unfortunate for individual liberty, but also for prosperity since the economic freedom of a country strongly correlates with higher incomes and lower poverty. The world appears to be recovering freedom and wealth, but it lost years of progress to government meddling.
The latest edition of the Economic Freedom of the World report, published by Canada’s Fraser Institute, the Cato Institute, “and more than 70 think tanks around the world” is out, and it finds the world digging itself out of a hole that started in 2020.
“Overall, the index shows that economic freedom has increased since 2000, but fell precipitously following the coronavirus pandemic, erasing nearly a decade of progress,” the authors note. “We take no position on the efficacy of the various public-health policies designed to deal with the coronavirus pandemic; they very well may have saved millions of lives, or they may have been completely ineffectual….Our concern is economic freedom, and on that margin, there is no question that government policies responding to the coronavirus pandemic have reduced economic freedom.”
While global economic freedom has started to improve again as the pandemic and its interventions fade into memory, the average across nations is back to where it was in 2012. Weighted for population, which accounts for large countries with statist governments including China, the world’s economic freedom is just a hair better than it was in 2013 and has yet to start recovery from the COVID-era dip.
The index shows North America experiencing the largest decline over the measured period, with Latin America, the Caribbean, the Middle East, and North Africa following. “The latter region’s decline is especially tragic given its low starting point,” comment the authors.
“In 2023—the latest year for which data are available—the 10 highest scoring nations were Hong Kong, Singapore, New Zealand, Switzerland, the United States, Ireland, Australia and Taiwan (tied for 7th), Denmark, and the Netherlands.”
Hellbound and Down 