Economic Freedom of The World 2023

James Gwartney, Robert Lawson,
and Ryan Murphy

with Matanda Abubaker, Andrea Celico,
Alexander C.R. Hammond, Fred McMahon, and Martin Rode
Economic Freedom
of the World
2023
ANNUAL REPORT
MOST FREE 2ND QUARTILE 3RD QUARTILE LEAST FREE

Economic Freedom
of the World
2023 Annual Report
James Gwartney Robert Lawson Ryan Murphy
Florida State University Southern Methodist University Southern Methodist University
with
Matanda Abubaker Andrea Celico Alexander C.R. Hammond

Uganda Judiciary Universidad de Navarra Initiative for African Trade and Prosperity
Islamic University in Uganda Institute of Economic Affairs
Fred McMahon Martin Rode

Fraser Institute Universidad de Navarra
2023
Copyright ©2023 by the Fraser Institute. All rights reserved. No part of this book may be
reproduced in any manner whatsoever without written permission except in the case of brief
quotations embodied in critical articles and reviews.
The authors of this book have worked independently and opinions expressed by them are,
therefore, their own and do not necessarily reflect the opinions of the supporters, directors,
or staff of the Fraser Institute. This publication in no way implies that the Fraser Institute, its
directors, or staff are in favor of, or oppose the passage of, any bill; or that they support or
oppose any particular political party or candidate.
Published in cooperation with the Economic Freedom Network.
Cover design: Joel Poirier, Peng Wei, and Heather Jalbout.
Printed and bound in Canada.
Data available to researchers The full data set, including all of the data published in this
report as well as data omitted because of limited space, can be downloaded for free at <www.
fraserinstitute.org/economic-freedom/dataset>. The data file available there contains the most up-
to-date and accurate data for the Economic Freedom of the World index. Some variable names
and data sources have evolved over the years since the first publication in 1996; users should
consult earlier editions of Economic Freedom of the World for details about sources and
descriptions for those years. All editions of the report are available in PDF and can be down-
loaded for free from <https://www.fraserinstitute.org/studies/economic-freedom>. However, users
are always strongly encouraged to use the data from this most recent data file as updates and
corrections, even to earlier years’ data, do occur. Users doing long-term or longitudinal stud-
ies are encouraged to use the EFW Panel Dataset as it is the most consistent through time.
Technical help If you have difficulty downloading the data, please contact Matthew Mitchell
via e-mail to <[email protected]>. If you have technical questions about the data
itself, please contact Ryan Murphy <[email protected]> or Robert Lawson <[email protected]>.
Citing the data Please cite the data in your bibliography as: Robert Lawson and Ryan
Murphy (2023). Economic Freedom Dataset, published in Economic Freedom of the World:
2023 Annual Report. Fraser Institute. <www.fraserinstitute.org/economic-freedom/dataset>.
Citing this publication James Gwartney, Robert Lawson, and Ryan Murphy (2023). Eco-
nomic Freedom of the World: 2023 Annual Report. Fraser Institute.
Published work using ratings from Economic Freedom of the World A list of published papers
that have used the economic-freedom ratings from Economic Freedom of the World is avail-
able on line at <www.fraserinstitute.org/economic-freedom/citations>. In most cases, a brief abstract
of the article is provided. If you know of other papers current or forthcoming that should
be included on this page, or have further information about any of these papers or authors,
please write to <[email protected]>.
Cataloguing Information
Gwartney, James D. / Economic freedom of the world … annual report / James D.
Gwartney. Annual. Description based on: 1997
2023 issue by James Gwartney, Robert Lawson, and Ryan Murphy; with Matanda Abubaker,
Andrea Celico, Alexander C.R. Hammond, Fred McMahon, and Martin Rode.
Issued also on line.
ISSN 1482-471X; ISBN 978-0-88975-743-1 (2023 edition); 978-0-88975-744-8 (2023 US edition).
1. Economic history--1990- --Periodicals. 2. Economic indicators--Periodicals.
I. Fraser Institute (Vancouver, B.C.) II. Title
Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

Table of Contents
Executive Summary / v
Chapter 1 Economic Freedom of the World in 2021 / 1
Chapter 2 Country Data Tables / 23
Chapter 3 Populism, Majority Rule, and Economic Freedom / 189

Andrea Celico and Martin Rode
Chapter 4 The Rule of Law and Economic Freedom: Two Sides of the Same Coin
for Purchasing Economic Prosperity / 207
Matanda Abubaker
Chapter 5 Diamonds, Dynasties, or Decent Decisions? The Origin of Botswana’s

Liberal Policies and their Contemporary Unravelling / 221
Alexander C.R. Hammond
Appendix Explanatory Notes and Data Sources / 249
About the Authors / 263
About the Contributors / 264
Acknowledgments / 266
The Economic Freedom Network / 267
fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Economic Freedom of the World: 2023 Annual Report • v
Executive Summary
The index published in Economic Freedom of the World measures the degree to
which the policies and institutions of countries are supportive of economic free-
dom. The cornerstones of economic freedom are personal choice, voluntary
exchange, freedom to enter markets and compete, and security of the person
and privately-owned property. Forty-five data points are used to construct a sum-
mary index, along with a Gender Legal Rights Adjustment to measure the extent
to which women have the same level of economic freedom as men. The degree of
economic freedom is measured in five broad areas.
Area 1: Size of Government

As government spending, taxation, and the size of government-controlled enter-
prises increase, government decision-making takes the place of individual choice
and economic freedom is reduced.
Area 2: Legal System and Property Rights

Protection of persons and their rightfully acquired property is a central element
of both economic freedom and civil society. Indeed, it is the most important func-
tion of government. If property is not secure, if individuals are not safe, if the judi-
ciary is not impartial, or if the rule of law is undermined, then, again, economic
freedom is reduced.
Area 3: Sound Money

Inflation erodes the value of rightfully earned income and savings, and changes
the terms of agreed-upon contracts. Sound money is thus essential to protect
property rights. When inflation is high or volatile, it becomes difficult for indi-
viduals to plan for the future and limits their economic freedom.
Area 4: Freedom to Trade Internationally

Freedom to exchange—in its broadest sense, buying, selling, making contracts,
and so on—is the essence of economic freedom. And this freedom is reduced
when government impediments to trade make it costly or even impossible to
exchange with businesses and individuals in other nations.
Area 5: Regulation
Governments not only use a number of tools to limit the right to exchange inter-
nationally, they may also impose onerous regulations, domestically as well as on
international trade, that limit the right to exchange, gain credit, hire or work for
whomever one wishes, or freely operate one’s business. As these limits multiply,
economic freedom decreases.

vi • Economic Freedom of the World: 2023 Annual Report
Gender Legal Rights Adjustment

The index published in Economic Freedom of the World now includes an adjust-
ment for gender disparity to take into account the fact that in many nations
women are not legally accorded the same level of economic freedom as men.
The Gender Disparity Index and its use in making the adjustment is described
in Chapter 3: Adjusting for Gender Disparity in Economic Freedom and Why It
Matters, pp. 189–211 in the report of 2017.1
Jurisdictions
The total number of jurisdictions in the index is 165. The data are available annu-
ally from 2000 to 2021 and for years ending in zero or five back to 1970. This
dataset makes it possible for scholars to analyze the impact of both cross-coun-
try differences in economic freedom and changes in that freedom across a time
frame of several decades. Separate estimates are also provided at five-year inter-
vals back to 1950 on the economic freedom website.2
Related research
Since our first publication in 1996, over 700 studies have used the data pub-
lished in Economic Freedom of the World to examine the impact of economic
freedom on human well-being.3 The strong balance of the evidence suggests
that those who live in jurisdictions with greater economic freedom experi-
ence higher levels of well-being as measured by factors such as greater produc-
tivity, more rapid economic growth, higher income levels, less poverty, less
corruption, and fewer conflicts.
Changes to the Index

Two important sources of data for the EFW—the World Bank’s annual Doing
Business report and the World Economic Forum’s annual Global Competitiveness
Report—have not been published in the last three years. While there is some hope
that both sources will return in some capacity, the situation remains uncertain and
the timing unknown. So, rather than use increasingly dated data we have begun
to incorporate alternative sources of data from the Economist Intelligence Unit’s
(EIU) Business Environment Rankings into the EFW.
For the most part, we have been able to integrate the new EIU data easily into
the existing structure of the EFW index. A few of the EIU indicators, however,
do not have natural places within the existing EFW index structure. As a result,
we have had to make a few adjustments to the component and subcomponent
structure. These changes mean that this edition of the EFW contains 45 distinct
components or subcomponents instead of the 42 used earlier.
We have also taken this opportunity to revise and shorten several area, com-
ponent, and subcomponent labels. All of these changes are documented in the
Appendix: Explanatory Notes and Data Sources (pp. 249–262).
1 <https://fraserinstitute.org/studies/economic-freedom-of-the-world-2017-annual-report>
2 A comprehensive data set is available at <www.fraserinstitute.org/economic-freedom/dataset>.
3 For a review of these studies, see the chapter, Economic Freedom in the Literature: What Is It
Good (Bad) For? (Robert Lawson, Economic Freedom of the World: 2022 Annual Report: 187–
200; <https://www.fraserinstitute.org/studies/economic-freedom-in-the-literature-what-is-it-good-bad-for>.

Economic Freedom of the World: 2023 Annual Report • vii
Economic freedom around the world in 2021
Top-rated countries
The most recent comprehensive data available are from 2021. For the first
time in the history of the index, Hong Kong slipped from its top position. The
Chinese government imposed new and significant barriers to entry, limits on
the employment of foreign labor, and increases in the costs of doing business,
which drove a 0.25-point decline in Hong Kong’s Area 5 (regulation) compo-
nent. Meanwhile, increased military interference in the rule of law and eroding
confidence in judicial independence and the impartiality of Hong Kong courts
led to a 0.20-point decline in the jurisdiction’s Area 2 (legal system and property
rights) component.
As Hong Kong declined, Singapore’s scores improved. Driven by improve-
ments in its size of government and regulation components, Singapore’s overall
score rose 0.06 points to take the top ranking. The next highest scoring nations
are Switzerland, New Zealand, United States, Ireland, Denmark, Australia, United
Kingdom, and Canada.
Rankings of other major countries

Taiwan (11th), Japan (20th), Germany (23rd), Korea (42nd), France (47th), Italy (53rd),
Mexico (68th), India (87th), Russia (104th), Brazil (90th), and China (111th).
Ten lowest-rated countries

Republic of Congo, Algeria, Argentina, Libya, Iran, Yemen, Sudan, Syria, Zimbabwe,
and, lastly, Venezuela.
Well-being is much greater in economically free jurisdictions
• Nations in the top quartile of economic freedom had an average per-capita

GDP of $48,569 in 2021, compared to $6,324 for nations in the bottom
quartile (PPP constant 2017, international$) (exhibit 1.5).
• In the top quartile, the average income of the poorest 10% was $14,091,
compared to $1,740 in the bottom quartile (PPP constant 2017, inter-
national$) (exhibit 1.7). Interestingly, the average income of the poorest
10% in the most economically free nations is more than twice the average
income of all people in the least free nations (exhibits 1.5 and 1.7).
• In the top quartile, 2.02% of the population experience extreme poverty

(US$1.90 a day) compared to 31.45% in the lowest quartile (exhibit 1.10).
• Life expectancy is 80.8 years in the top quartile compared to 65.0 years in
the bottom quartile (exhibit 1.8).
• In the top quartile, the infant mortality rate is 4.2 per 1,000 live births
while in the bottom quartile, it is 39.1 per 1,000 live births (exhibit 1.9).
• In the top quartile, 0.98% of the population experience extreme poverty

(US$2.15 a day) compared to 31.86% in the lowest quartile (exhibit 1.10).

viii • Economic Freedom of the World: 2023 Annual Report
A decade of growth in economic freedom

was erased in 2020
Exhibit 1.4 shows the global average economic freedom score for all 123 juris-
diction with complete data since 2000. Between 2000 and 2019, the average
economic freedom rating increased from 6.58 to 6.94 but in 2020 the average
rating fell to 6.77, where it remained in 2021. The last time the average economic
freedom rating was this low was 2009.
Exhibit 1.4: Average Economic Freedom Rating, 2000–2021

7.0
6.94
6.93
6.91
6.9 6.91
6.86 6.87
6.88
Average rating on EFW index
6.82
6.8 6.79 6.79 6.82
6.76
6.74 6.77 6.77
6.74 6.73
6.7 6.68
6.66
6.62
6.6
6.58 6.59
6.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Chapters in the report
Chapter 1: Economic Freedom of the World in 2021

The authors of the report, James Gwartney, Robert Lawson, and Ryan Murphy,
provide an overview of the report and discuss why economic freedom is important.
Chapter 2: Country Data Tables

The tables in chapter 2 provide detailed historical information for the 165 jurisdic-
tions in the index. For each jurisdiction for which data were available, the tables
show the overall EFW index rating and the rank of that country for the years 1980,
1990, 2000, 2010, 2015, 2019, 2020, and 2021.
Chapter 3: Populism, Majority Rule, and Economic Freedom

In this chapter, Andrea Celico and Martin Rode of the Universidad de Navarra
investigate the relationship between populism and economic freedom. They also
consider the potentially mediating roles of institutional constraints and govern-
ment ideology. Controlling for other determinants, they find that populism in

Economic Freedom of the World: 2023 Annual Report • ix
government is significantly associated with reductions in economic freedom for

a large sample of democratic countries. They also find that in OECD countries,
the negative association between populism and economic freedom seems to be
mediated to a substantial degree by political constraints and political ideology.
It is possible that institutional guardrails, which are often absent in many non-
OECD countries, check the power of populist governments.
Chapter 4: The Rule of Law and Economic Freedom: Two Sides

of the Same Coin for Purchasing Economic Prosperity
Matanda Abubaker
In this chapter, the Ugandan judge and law lecturer, Matanda Abubaker, discusses
the relationship between economic freedom and the rule of law. He explores what
is meant by the rule of law and he concludes that causality runs in both directions:
while there cannot be economic freedom without the rule of law, economic free-
dom also enhances the rule of law. He also argues that when one of the two is
threatened, the other is also threatened.
Chapter 5: Diamonds, Dynasties, or Decent Decisions? The Origin of

Botswana’s Liberal Policies and their Contemporary Unravelling
In this chapter, Alexander Hammond of the Institute of Economic Affairs explores
Botswana’s unique economic history. In a continent dogged by stagnant growth,
Botswana prospers. For the last half century, the economy of this sparsely popu-
lated nation in southern Africa has grown faster than that of almost any other
in the world. While economists generally agree that Botswana owes its relative
prosperity to its long-standing commitment to decent levels of economic free-
dom, there is less agreement about what has permitted Botswana to maintain this
commitment. Here, Hammond attributes the nation’s freedom to good decision-
making, political and socio-economic stability, and certain internal and external
constraints on policy makers’ decisions. Alarmingly, however, he concludes that
some of these factors may be waning.

Chapter 1 Economic Freedom of the World in 2021
Economic Freedom of the World is is an ongoing research project. As Milton

Friedman stated in his foreword to the initial report, Economic Freedom of the
World: 1975–1995 (Gwartney, Lawson, and Block, 1996), additional work would
be necessary to “bring the indexes of economic freedom up to date and to incor-
porate the additional understanding that will be generated”. This has never been
more true than this year as we have begun to integrate a number of new indicators
to compensate for the cancelation or delay of some of our key data sources. We
have also made a few structural changes to the index itself by incorporating new
components and subcomponents within the traditional five areas.
We urge users of the EFW index to use the data only from the most recent
report because of data updates and changes to the report’s methodology over
time. All the ratings for all countries and years for which we have ratings are avail-
able in the datafile corresponding to each new report.
What is economic freedom?
Economic freedom is based on the concept of self-ownership. Because of this self-

ownership, individuals have a right to choose—to decide how to use their time
and talents to shape their lives. On the other hand, they do not have a right to the
time, talents, and resources of others. Thus, they have no right to take things from
others or demand that others provide things for them.
The cornerstones of economic freedom are personal choice, voluntary exchange,
open markets, and clearly defined and enforced property rights. Individuals are
economically free when they are permitted to choose for themselves and engage
in voluntary transactions as long as they do not harm the person or property of
others. When individuals possess economic freedom they are able to decide what,
when, and how goods and services will be produced, exchanged, and consumed.
Put another way, economically free individuals are permitted to decide for them-
selves rather than having options imposed on them by the political process or by
the use of violence, theft, or fraud by others.
The EFW index is designed to measure the degree to which the institutions and
policies of countries are consistent with economic freedom. In order to achieve
a high EFW rating, a country’s government must do some things, but refrain
from others. Governments enhance economic freedom when they provide an
infrastructure for voluntary exchange, and protect individuals and their prop-
erty from aggressors who might use violence, coercion, or fraud to seize things
that do not belong to them. To this end, the legal system is particularly impor-
tant. A country’s legal institutions must protect the person and property of all

2 • Economic Freedom of the World: 2023 Annual Report
individuals from the aggressive acts of others and enforce contracts in an even-
handed manner. Governments must also permit access to a sound money that
results in macroeconomic price stability and predictability. Governments must
also refrain from actions that restrict personal choice, interfere with voluntary
exchange, and limit entry into markets. Economic freedom is reduced when taxes,
government expenditures, and regulations override personal choice, voluntary
exchange, and market coordination.
The EFW measure might be thought of as a measure of the degree to which
scarce resources are allocated by personal choices coordinated by markets rather
than by centralized planning directed by the political process. It might also be
thought of as an effort to identify how closely the institutions and policies of a
country correspond with the classical liberal ideal of a limited government, where
the government protects property rights and arranges for the provision of a limited
set of “public goods” such as national defense and access to money of sound value,
but little beyond these core functions. To a large degree, a country’s EFW sum-
mary rating is a measure of how closely its institutions and policies compare with
the idealized structure implied by standard textbook analysis of microeconomics.
The Economic Freedom of the World index—an overview
The EFW index provides a comprehensive measure of the degree to which a juris-
diction’s institutions and policies are consistent with economic freedom. It is an
outgrowth of a series of six conferences hosted by Milton and Rose Friedman
and Michael Walker from 1986 to 1994, which resulted in three books (Walker,
1988; Block, 1991; Easton and Walker, 1992) documenting the discussion and
various prototype indexes that culminated with the initial publication, Economic
Freedom of the World: 1975–1995. In addition to the Friedmans, several of the
world’s leading economists including Douglass North, Gary Becker, Peter Bauer,
William Niskanen, and Gordon Tullock participated in the discussions leading
to the EFW index. The index is published by a network of institutes spearheaded
by the Fraser Institute in Canada. Members of the network and other interested
parties meet annually to review the structure of the index and consider ideas for
its improvement.
The construction of the EFW index is based on three important methodologi-
cal principles. First, objective sources of data are preferred to those that involve
surveys or value judgments. With that said, given the multidimensional nature
of economic freedom and the importance of legal and regulatory elements, it is
sometimes necessary to use data based on surveys, expert panels, and generic
case studies. To the fullest extent possible, however, the index uses objective
sources of data. Second, the data used to construct the index ratings are from
external sources such as the International Monetary Fund, World Bank, and
World Economic Forum that provide data for a large number of jurisdictions.
Data provided directly from a source within a country are rarely used. Importantly,
the value judgments of the authors or others in the Economic Freedom Network
are never used to alter the raw data or the rating of any country. Third, we strive
for transparency throughout. The report provides information about the data
sources, the methodology used to transform raw data into the ratings of the com-
ponents and subcomponents and how these ratings are used to construct both the

Chapter 1: Economic Freedom of the World in 2021 • 3
area and summary ratings. Methodological details can be found in the Appendix:
Explanatory Notes and Data Sources of this report (pp. 249–262). The entire data
set used in the construction of the index is freely available to researchers at <www.
fraserinstitute.org/economic-freedom/dataset>.
The EFW index rates 165 jurisdictions. The data are available annually from
2000 to 2021 and for years ending in zero or five back to 1970. This dataset makes
it possible for scholars to analyze the impact of both cross-country differences
in economic freedom and changes in that freedom across several decades. The
EFW measure is a valuable tool for scholars seeking to examine the contribution
of economic institutions more thoroughly and to disentangle their influence from
political, climatic, locational, cultural, and historical factors as determinants of
growth and development.
Structure of the EFW index

Exhibit 1.1 indicates the structure of the EFW index. The index measures the
degree of economic freedom present in five major areas: [1] Size of Government,
[2] Legal System and Property Rights, [3] Sound Money [4] Freedom to Trade
Internationally, and [5] Regulation.
Within the five major areas, there are a total of 25 components in the index.
Many of the components are themselves made up of several subcomponents
(which in turn may be based on several more underlying sources of data). In total,
the index incorporates 45 distinct components and or subcomponents of data.
Each component and subcomponent is placed on a scale from 0 to 10 that reflects
the distribution of the underlying data. When subcomponents are present, they
are averaged to derive the component rating. The component ratings within each
area are then averaged to derive ratings for each of the five areas. In turn, the five
area ratings are averaged to derive the summary rating for each country.
Area 1. Size of Government focuses on how government expenditures and tax rates
affect economic freedom. Taken together, the five components of Area 1 measure
the degree to which a country relies on personal choice and markets rather than
government budgets and political decision-making. Countries with lower levels
of government spending, lower marginal tax rates, less government investment,
and state ownership of assets earn the highest ratings in this area.
Area 2. Legal System and Property Rights focuses on the importance of the legal sys-
tem as a determinant of economic freedom. Protection of persons and their right-
fully acquired property is a central element of economic freedom. Many would
argue that it is the most important function of government. The key ingredients
of a legal system consistent with economic freedom are rule of law, security of
property rights, an independent and unbiased judiciary, and impartial and effec-
tive enforcement of the law. The eight components of Area 2 are indicators of how
effectively the protective functions of government are performed. The rating for
Area 2 is adjusted based on a gender-disparity index that reflects cross-country
differences in legal rights based on gender.
Area 3. Sound Money focuses on the importance of money and general price sta-
bility in the exchange process. Sound money—money with relatively stable pur-
chasing power across time—reduces transaction costs and facilitates exchange,

Exhibit 1.1: Areas, Components, and Subcomponents of the EFW Index
1. Size of Government
A. Government consumption D. Top marginal tax rate
(i) Top marginal income tax rate
B. Transfers and subsidies
(ii) Top marginal income and payroll tax rates
C. Government investment
E. State ownership of assets
2. Legal System and Property Rights

A. Judicial independence E. Integrity of the legal system
B. Impartial courts F. Contracts
C. Property rights G. Real property
D. Military interference H. Police and crime
Note: Area 2 ratings are calculated with adjustments for inequalities in the legal treatment of women using a Gender Disparity Index
produced by Rosemarie Fike. The adjusted Area 2 rating is used to compute the summary rating.
3. Sound Money
A. Money growth C. Inflation: most recent year
B. Standard deviation of inflation D. Foreign currency bank accounts
4. Freedom to Trade Internationally

A. Tariffs C. Black-market exchange rates
(i) Trade tax revenue
D. Controls of the movement of capital and people
(ii) Mean tariff rate
(i) Financial openness
(iii) Standard deviation of tariff rates
(ii) Capital controls
B. Regulatory trade barriers (iii) Freedom of foreigners to visit
(i) Non-tariff trade barriers (iv) Protection of foreign assets
(ii) Costs of importing and exporting
5. Regulation
A. Credit market regulation C. Business regulation
(i) Ownership of banks (i) Regulatory burden
(ii) Private sector credit (ii) Bureaucracy costs
(iii) Interest rate controls / negative real interest rates (iii) Impartial public administration
(iv) Tax compliance
B. Labor market regulation
(i) Labor regulations and minimum wage D Freedom to compete
(ii) Hiring and firing regulations (i) Market openness
(iii) Flexible wage determination (ii) Business permits
(iv) Hours regulations (iii) Distortion of business environment
(v) Costs of worker dismissal
(vi) Conscription
(vii) Foreign labor

thereby promoting economic freedom. The four components of this area pro-
vide a measure of the extent to which people in different countries have access
to sound money. In order to earn a high rating in Area 3, a country must follow
policies and adopt institutions that lead to low (and stable) rates of inflation and
avoid regulations that limit the ability to use alternative currencies.
Area 4. Freedom to Trade Internationally focuses on exchange across national bound-

aries. In our modern world, freedom to trade with people in other countries is an
important ingredient of economic freedom. When governments impose restric-
tions that reduce the ability of their residents to engage in voluntary exchange
with people in other countries, economic freedom is diminished. The compo-
nents in Area 4 are designed to measure a wide variety of trade restrictions:
tariffs, quotas, hidden administrative restraints, and controls on exchange rates
and the movement of capital. In order to get a high rating in this area, a country
must have low tariffs, easy clearance and efficient administration of customs, a
freely convertible currency, and few controls on the movement of physical and
human capital.
Area 5. Regulation measures how regulations that restrict entry into markets and
interfere with the freedom to engage in voluntary exchange reduce economic
freedom. The components of Area 5 focus on regulatory restraints that limit the
freedom of exchange in credit, labor, and product markets.
Key changes and issues in the EFW index in the 2023 Annual Report
The last few years have been a huge challenge for the EFW index as two of our
most important data sources became unavailable. The World Bank’s Doing Business
report was abruptly canceled, and data from the World Economic Forum’s Global
Competitiveness Report have not been published in the last three years. These two
sources had been used in whole, or in part, in 17 of the 42 (40%) components or
subcomponents in the EFW index. In the last three reports, we continued to use
the latest available data. While there is some hope that both sources will return in
some capacity, the situation remains uncertain and the timing unknown.
Over the last couple of years as we cast about for solutions to these difficul-
ties, we turned to the Economist Intelligence Unit’s (EIU) Business Environment
Rankings. We had looked at their numbers previously and generally judged them
to be high quality, but their main dataset covered only about 80 countries, far
short of the 165 that we require. We contacted them last year to ask if they could
rate all 165 jurisdictions. Ultimately, we were able to contract with the EIU to get
the numbers we wanted for all of our countries for the years since 2017.
For the most part, we have been able to integrate the new EIU data easily
into the existing structure of the EFW index. A few of the EIU indicators do not
have natural places within the existing EFW index structure, and as a result, we
have had to make a few adjustments to the component and subcomponent struc-
ture. There are a few components and subcomponents that remain wholly reliant
on the Doing Business or Global Competitiveness Report data that have not been
updated here. We hope to deal with these in the next year or two. These compo-
nents are the following: 4Bii (Costs of importing and exporting), 5Biii (Flexible
wage determination, 5Biv (Hours regulations), 5Bv (Cost of worker dismissal),
and 5Ci (Regulatory burden).

Here is a brief description of the changes to the structure of the index by area
related to the EIU data integration
Area 1. Size of Government: This area is unchanged.
Area 2. Legal System and Property Rights: The component structure is unchanged,
but EIU data were integrated into components 2B, 2C, 2F, and 2H.
Area 3. Sound Money: This area is unchanged.
Area 4. Freedom to Trade Internationally: The component structure is unchanged.

EIU data were integrated into subcomponents 4Bi, 4Di, and 4Div. 4Div is a new
subcomponent within component 4D related to the protection of foreign assets
and investments.
Area 5. Regulation: We now have four components in Area 5 instead of the previ-
ous three. Components 5A and 5B and 5C have the same titles. Several subcom-
ponents in the old 5C have been moved to form part of the new component 5D,
which is labelled “Freedom to compete”. The appropriate EIU data were inte-
grated into subcomponents 5Bi, 5Bii, 5Bvii, 5Civ, 5Di, and 5Diii. 5Bvii is a new
subcomponent about the ease of hiring foreign labor. Subcomponent 5Diii is new
and is labelled “Distortion of the business environment”; it relies on EIU data on
“price controls” and “state control” of private businesses.
Here is a list of the EFW components and subcomponents into which the new
EIU variables are being integrated:
EFW EIU variable
2B Transparency and fairness of legal system
2C Degree to which private property rights are guaranteed and protected
2F Efficiency of legal system
2H Impact of crime
4Bii Tariff and non-tariff barriers
4Di Capital account liberalisation
4Div Risk of expropriation of foreign assets
5Bi Wage regulation
5Bii Restrictiveness of labour laws
5Bvii Hiring of foreign nationals
5Ci Level of government regulation and impact on private business
5Ciii Government favouritism
5Civ Tax complexity
5Di Freedom of existing businesses to compete
5Diii Price controls & State control
We understand that big changes to the index structure like this can pose difficulties
for our users, but at some point we had to deal with the loss of the data from Doing
Business and the Global Competitiveness Report. It is important to note that every
effort has been made to make the data consistent on a time-series basis. For example,

when a component or subcomponent is based on several underlying sources of data

(for example, both old Global Competitiveness Report data and new EIU data), we
are employing our familiar chain-linking method to assure the best possible consis-
tency within that component or subcomponent over time. And of course, we will
continue to provide the full chain-linked panel data set of area and summary ratings.
We have also taken this opportunity to revise and shorten several area, com-
ponent, and subcomponent labels. All of these changes are documented in the
Appendix: Explanatory Notes and Data Sources (pp. 249–262).
Construction of Area and Summary ratings

Theory provides us with some direction about elements that should be included in
the five areas and the summary index, but it does not indicate what weights should
be attached to the components within the areas or among the areas in the construc-
tion of the summary index. It would be convenient if these factors were indepen-
dent and a weight could be attached to each of them. In the past, we investigated
several methods of weighting the various components, including principal compo-
nent analysis and a survey of economists. We have also invited others to use their
own weighting structure if they believe that it is preferable. Our experience indi-
cates that the summary index is not very sensitive to alternative weighting methods.
Furthermore, there is reason to question whether the areas (and components)
are independent of one another, or if instead, they work together like the wheels,
motor, transmission, drive shaft, and frame of a car. Just as these interconnected
parts allow an automobile to move forward, it may be that a combination of inter-
related factors allows people to enjoy economic freedom. Which is more important
for the mobility of an automobile: the motor, wheels, or transmission? The ques-
tion cannot be easily answered because the parts work together. If any of these key
parts break down, the car is immobile. Institutional quality may be much the same.
If any of the key parts are absent, the overall effectiveness may be undermined.
As the result of these two considerations, we organize the elements of the index
in a manner that seems sensible, but we make no attempt to weight the compo-
nents in any special way when deriving either area or summary ratings. Of course,
the component and subcomponent data are available to researchers who would
like to consider alternative weighting schemes and we encourage them to do so.
Summary Economic Freedom ratings in 2021
Exhibits 1.2a and 1.2b (pp. 8–9) present the summary economic freedom ratings,
sorted from highest to lowest, for the 165 jurisdictions of this year’s report. These
ratings are for 2021, the most recent year for which comprehensive data are avail-
able. Hong Kong and Singapore, as usual, occupy the top two positions—but for
the first time in the history of the EFW index, Singapore edges out Hong Kong for
the #1 ranking.1 The next highest scoring nations are Switzerland, New Zealand,
United States, Ireland, Denmark, Australia, United Kingdom, and Canada.
1 It is worth noting that this exchange of positions is not an artifact of the integration of the EIU data
and/or changes to the EFW index structure in this year’s report; Hong Kong would have dropped
to 2nd position even had we made no changes to the EFW index methodology in this year’s report.

Exhibit 1.2a: Summary Economic Freedom Ratings for 2021, First and Second Quartiles
0 2 4 6 8 10 0 2 4 6 8 10
Singapore 1 8.56 Korea, Republic 42 7.47
Hong Kong SAR, China 2 8.55 Bulgaria 43 7.46
Switzerland 3 8.47 Jamaica 43 7.46
New Zealand 4 8.43 Bahrain 45 7.44
United States 5 8.14 Belgium 46 7.43
Ireland 6 8.11 France 47 7.40
Denmark 7 8.10 Cabo Verde 48 7.38
Australia 8 8.05 Hungary 49 7.36
United Kingdom 9 8.01 United Arab Emirates 50 7.35
Canada 10 7.98 Dominican Republic 51 7.30
Taiwan 11 7.97 Jordan 51 7.30
Estonia 12 7.95 Croatia 53 7.25
Lithuania 12 7.95 Italy 53 7.25
Iceland 14 7.93 Slovenia 55 7.23
Luxembourg 15 7.91 Malaysia 56 7.19
Mauritius 15 7.82 Moldova 57 7.18
Czechia 17 7.81 Kazakhstan 58 7.13
Finland 17 7.81 Brunei Darussalam 59 7.12
Sweden 17 7.81 Poland 59 7.12
Japan 20 7.79 Seychelles 59 7.12
Costa Rica 21 7.76 El Salvador 62 7.11
Netherlands 21 7.76 Gambia, The 62 7.11
Germany 23 7.73 Thailand 64 7.07
Malta 23 7.73 North Macedonia 65 7.06
Georgia 25 7.71 Uruguay 65 7.06
Latvia 25 7.71 Mongolia 67 7.04
Romania 27 7.70 Mexico 68 7.02
Austria 28 7.69 Paraguay 68 7.02
Norway 29 7.67 Philippines 70 7.01
Chile 30 7.66 Honduras 71 6.97
Albania 31 7.60 Barbados 72 6.94
Montenegro 32 7.59 Greece 72 6.94
Armenia 33 7.58 Indonesia 74 6.93
Cyprus 34 7.57 Kyrgyz Republic 75 6.88
Israel 34 7.57 Serbia 76 6.85
Portugal 36 7.54 Botswana 77 6.84
Peru 37 7.52 Cambodia 78 6.82
Spain 37 7.52 Kenya 78 6.82
Panama 39 7.51 Rwanda 80 6.77
Guatemala 40 7.50 Nigeria 81 6.67
Slovak Republic 41 7.49 Bosnia and Herzegovina 82 6.66
spare spare

Exhibit 1.2b: Summary Economic Freedom Ratings for 2021, Third and Fourth Quartiles
0 2 4 6 8 10 0 2 4 6 8 10
Saudi Arabia 83 6.64 Lesotho 124 5.95
Uganda 83 6.64 Madagascar 125 5.92
Kuwait 85 6.63 Belize 126 5.91
Trinidad and Tobago 85 6.63 Sierra Leone 126 5.91
Bhutan 87 6.62 Malawi 128 5.87
India 87 6.62 Zambia 129 5.84
Colombia 89 6.60 Liberia 130 5.82
Brazil 90 6.58 Timor-Leste 130 5.82
Oman 90 6.58 Bangladesh 132 5.81
Qatar 90 6.58 Mali 133 5.80
Bahamas, The 93 6.55 Niger 133 5.80
South Africa 94 6.53 Djibouti 135 5.79
Nicaragua 95 6.52 Mauritania 136 5.78
Ecuador 96 6.46 Cameroon 137 5.72
Morocco 97 6.42 Somalia 138 5.66
Benin 98 6.41 Comoros 139 5.63
Ghana 98 6.41 Guinea 140 5.62
Tajikistan 100 6.38 Guinea-Bissau 141 5.53
Fiji 101 6.32 Suriname 142 5.52
Türkiye 101 6.32 Iraq 143 5.49
Nepal 103 6.30 Egypt, Arab Republic 144 5.47
Russian Federation 104 6.28 Ethiopia 145 5.44
Tanzania 105 6.27 Guyana 146 5.43
Vietnam 106 6.26 Gabon 147 5.41
Lao PDR 107 6.24 Burundi 148 5.40
Togo 107 6.24 Angola 149 5.38
Belarus 109 6.23 Congo, Dem. Republic 150 5.33
Senegal 110 6.20 Eswatini 150 5.33
China 111 6.18 Myanmar 150 5.33
Ukraine 112 6.17 Chad 153 5.31
Namibia 113 6.16 Lebanon 154 5.15
Haiti 114 6.15 Central African Republic 155 5.01
Burkina Faso 115 6.14 Congo, Republic 156 4.85
Sri Lanka 116 6.13 Algeria 157 4.82
Bolivia 117 6.08 Argentina 158 4.77
Papua New Guinea 118 6.05 Libya 160 4.65
Côte d’Ivoire 119 6.04 Iran, Islamic Republic 160 4.53
Mozambique 120 6.03 Yemen, Republic 161 4.18
Tunisia 121 6.02 Sudan 162 3.98
Azerbaijan 122 5.99 Syrian Arab Republic 163 3.90
Pakistan 123 5.98 Zimbabwe 164 3.81
spare Venezuela, Bolivarian Rep. 165 3.01

The rankings of some other major countries are Taiwan (11th), Japan (20th),
Germany (23rd), Korea (42nd), France (47th), Italy (53rd), Mexico (68th), India
(87th), Brazil (90th), Russia (104th), and China (111th). The 10 lowest-rated coun-
tries are: Republic of Congo, Algeria, Argentina, Libya, Iran, Yemen, Sudan, Syria,
Zimbabwe, and Venezuela.
As noted above, Hong Kong had been at the top of the EFW index for all
years for which we had data—that is until this report when Singapore achieved a
slightly higher rating by just 0.01 points for 2021. In previous annual reports, we
sounded the alarm bell about signs of declining economic—and other—freedoms
in Hong Kong. In particular, we highlighted the new security law imposed in 2021
by the Chinese government with potential sentences of life imprisonment and the
accompanying arrests in its aftermath. Hong Kong’s rating has now fallen 0.64
points since its peak rating of 9.19 in 2010. In just the last two years, Hong Kong’s
rating has fallen by a whopping 0.40 points. How much of that decline is related
to China’s economic and political crackdown in Hong Kong and how much is
related to the coronavirus pandemic is difficult to discern, but we do note that
the decline in Hong Kong’s rating in recent years has been much larger than the
world’s average decline. It seems reasonable to assume that much of this decline
is related to China’s new harsh policies in Hong Kong and is not entirely the fault
of pandemic policies.
Ratings and rankings in 2021 for the five Areas of the index
Exhibit 1.3 (pp. 11–15) presents the ratings (and rankings) for each of the five
areas of the index. A number of interesting patterns emerge from an analysis of
these data. High-income industrial economies generally rank quite high for Legal
System and Property Rights (Area 2), Sound Money (Area 3), and Freedom to
Trade Internationally (Area 4). Their ratings were lower, however, for Size of
Government (Area 1) and Regulation (Area 5). This was particularly true for the
high-income countries of Western Europe.
On the other hand, a number of developing nations have a small fiscal size of
government but rate low in other areas, and as a result, have a low overall rating.
The lesson from this is clear: a small fiscal size of government is insufficient to
ensure economic freedom. The institutions of economic freedom, such as the rule
of law and property rights, as well as sound money, trade openness, and sensible
regulation are also required.
As the area ratings show, weakness in the rule of law and property rights is par-
ticularly pronounced in Sub-Saharan Africa, among Islamic nations, and for some
nations that were formerly part of the Soviet bloc, though several countries in the
latter group have made impressive strides toward improvement. Many nations in
Latin America and Southeast Asia also score poorly for rule of law and property
rights. The nations that rank poorly in this category also tend to score poorly in
the trade and regulation areas, even though several have reasonably sized govern-
ments and sound money.

Exhibit 1.3: Area Economic Freedom Ratings (Rankings) for 2021

Area 1 Area 2 Area 3 Area 4 Area 5
Size of Legal System and Sound Freedom to trade Regulation
Government Property Rights Money internationally
Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank)
Albania 7.73 (26) 5.28 (70) 9.59 (9) 8.43 (15) 6.97 (51)
Algeria 4.45 (163) 3.82 (128) 7.08 (126) 3.92 (159) 4.84 (150)
Angola 7.71 (28) 3.18 (146) 5.79 (156) 5.52 (139) 4.73 (153)
Argentina 6.21 (103) 4.98 (83) 4.04 (161) 3.32 (163) 5.30 (143)
Armenia 7.76 (25) 5.92 (52) 9.12 (53) 8.15 (39) 6.94 (52)
Australia 5.92 (122) 8.61 (9) 9.53 (18) 8.07 (46) 8.12 (10)
Austria 4.95 (150) 8.55 (10) 9.12 (52) 8.55 (12) 7.28 (38)
Azerbaijan 4.60 (161) 4.81 (91) 6.92 (133) 7.18 (72) 6.44 (86)
Bahamas, The 8.52 (8) 5.63 (63) 6.65 (144) 5.07 (151) 6.88 (54)
Bahrain 7.08 (56) 5.18 (76) 9.39 (30) 8.19 (35) 7.38 (32)
Bangladesh 8.32 (11) 2.70 (152) 6.92 (134) 5.45 (143) 5.67 (129)
Barbados 7.31 (46) 5.78 (58) 8.38 (88) 6.17 (115) 7.05 (47)
Belarus 6.25 (101) 4.27 (118) 8.92 (72) 6.20 (113) 5.51 (137)
Belgium 4.51 (162) 7.69 (20) 9.10 (57) 8.16 (38) 7.70 (22)
Belize 6.20 (104) 3.89 (126) 6.85 (137) 5.94 (125) 6.69 (75)
Benin 7.99 (20) 4.43 (112) 7.15 (122) 5.71 (133) 6.79 (64)
Bhutan 5.85 (128) 6.84 (33) 6.40 (149) 6.83 (83) 7.18 (41)
Bolivia 5.94 (120) 3.95 (125) 9.55 (14) 6.14 (118) 4.81 (151)
Bosnia & Herzegovina 6.76 (72) 4.52 (106) 8.21 (92) 7.06 (74) 6.77 (68)
Botswana 6.38 (95) 5.91 (53) 9.28 (38) 6.56 (95) 6.05 (108)
Brazil 6.55 (81) 5.19 (75) 8.87 (74) 6.73 (87) 5.59 (133)
Brunei Darussalam 6.67 (76) 5.13 (78) 8.82 (78) 7.31 (66) 7.66 (26)
Bulgaria 6.79 (70) 5.81 (56) 9.40 (28) 8.30 (23) 7.02 (49)
Burkina Faso 7.23 (50) 3.79 (129) 6.67 (142) 6.20 (112) 6.81 (62)
Burundi 6.71 (74) 3.52 (136) 8.06 (99) 3.22 (164) 5.51 (138)
Cabo Verde 7.16 (52) 6.39 (43) 9.64 (6) 6.96 (77) 6.74 (71)
Cambodia 8.85 (3) 3.78 (130) 9.13 (51) 6.70 (88) 5.66 (130)
Cameroon 7.23 (51) 2.74 (151) 7.16 (120) 5.42 (144) 6.03 (110)
Canada 6.28 (99) 8.30 (13) 9.18 (47) 8.14 (40) 7.99 (11)
Central African Rep. 6.35 (97) 2.17 (162) 6.60 (146) 5.06 (153) 4.88 (149)
Chad 7.35 (45) 2.45 (157) 6.97 (130) 5.14 (150) 4.63 (155)
Chile 7.47 (37) 6.86 (31) 9.27 (40) 7.99 (53) 6.73 (73)
China 5.08 (147) 4.77 (92) 8.49 (86) 6.96 (76) 5.62 (131)
Note: ratings are shown rounded to the nearest tenth of a point, but the rankings are based on the unrounded ratings.

Exhibit 1.3 (continued): Area Economic Freedom Ratings (Rankings) for 2021
Colombia 6.93 (64) 4.91 (85) 8.14 (97) 6.50 (99) 6.54 (83)
Comoros 6.42 (91) 3.09 (148) 6.74 (138) 5.80 (128) 6.10 (104)
Congo, Dem. Republic 7.57 (35) 2.51 (156) 6.03 (154) 5.51 (140) 5.02 (146)
Congo, Republic 5.83 (129) 2.80 (150) 5.31 (157) 5.78 (129) 4.53 (158)
Costa Rica 7.42 (40) 6.64 (40) 9.70 (5) 8.30 (24) 6.73 (72)
Côte d’Ivoire 6.61 (78) 4.59 (103) 6.94 (132) 5.64 (136) 6.41 (89)
Croatia 5.53 (133) 6.04 (50) 9.52 (19) 8.32 (22) 6.83 (58)
Cyprus 6.68 (75) 6.73 (38) 9.00 (68) 8.17 (36) 7.29 (37)
Czech Republic 6.19 (105) 7.34 (26) 9.42 (26) 8.73 (4) 7.37 (33)
Denmark 5.18 (143) 9.08 (2) 9.63 (7) 8.25 (31) 8.39 (4)
Djibouti 5.51 (134) 3.59 (133) 7.26 (115) 5.76 (131) 6.83 (59)
Dominican Republic 8.75 (5) 5.10 (80) 9.10 (56) 7.54 (60) 6.00 (113)
Ecuador 7.00 (60) 4.66 (97) 8.56 (85) 6.11 (120) 5.96 (117)
Egypt, Arab Republic 5.30 (140) 3.41 (139) 8.42 (87) 5.50 (142) 4.73 (154)
El Salvador 8.52 (7) 3.95 (124) 9.27 (39) 8.00 (50) 5.80 (124)
Estonia 6.42 (92) 7.95 (16) 8.91 (73) 8.28 (29) 8.18 (8)
Eswatini 5.17 (145) 3.11 (147) 7.78 (108) 5.07 (152) 5.52 (136)
Ethiopia 6.86 (67) 4.41 (113) 6.32 (151) 3.55 (160) 6.05 (109)
Fiji 6.76 (71) 4.59 (102) 7.11 (125) 5.39 (145) 7.74 (20)
Finland 4.90 (153) 8.90 (5) 9.10 (55) 7.99 (51) 8.18 (7)
France 4.88 (155) 7.48 (22) 9.11 (54) 8.26 (30) 7.28 (39)
Gabon 6.52 (84) 3.20 (145) 6.10 (153) 5.86 (127) 5.37 (140)
Gambia, The 8.05 (18) 4.63 (100) 9.19 (46) 6.62 (91) 7.05 (46)
Georgia 7.40 (41) 6.33 (45) 8.74 (81) 8.67 (7) 7.40 (31)
Germany 5.66 (131) 8.15 (14) 9.07 (62) 8.04 (47) 7.73 (21)
Ghana 8.29 (12) 5.21 (73) 6.29 (152) 6.16 (116) 6.11 (102)
Greece 4.79 (158) 6.13 (48) 9.06 (65) 8.38 (17) 6.32 (93)
Guatemala 9.04 (1) 4.49 (109) 9.44 (23) 7.84 (54) 6.70 (74)
Guinea 6.16 (106) 3.31 (142) 7.00 (129) 5.76 (130) 5.89 (120)
Guinea-Bissau 7.45 (38) 2.66 (153) 6.87 (136) 5.69 (134) 4.96 (147)
Guyana 3.86 (164) 4.70 (95) 6.73 (139) 6.04 (123) 5.83 (122)
Haiti 8.20 (15) 2.06 (164) 7.16 (119) 7.30 (68) 6.02 (111)
Honduras 8.87 (2) 3.86 (127) 9.26 (41) 6.55 (96) 6.31 (95)

Hong Kong SAR, China 7.92 (21) 7.58 (21) 9.57 (12) 9.04 (1) 8.64 (3)
Hungary 5.96 (118) 6.40 (42) 9.25 (43) 8.56 (11) 6.63 (78)
Iceland 5.98 (117) 8.77 (6) 9.42 (27) 8.38 (18) 7.12 (43)
India 7.64 (30) 5.29 (69) 7.99 (103) 6.19 (114) 5.98 (116)
Indonesia 8.13 (17) 4.58 (105) 9.54 (16) 6.49 (100) 5.91 (119)
Iran, Islamic Republic 6.59 (79) 3.26 (144) 5.90 (155) 2.39 (165) 4.49 (159)
Iraq 4.93 (152) 2.29 (160) 7.53 (110) 6.84 (82) 5.87 (121)
Ireland 6.40 (93) 7.88 (17) 9.22 (44) 8.86 (3) 8.20 (6)
Israel 6.05 (111) 6.21 (46) 9.58 (11) 8.67 (6) 7.33 (34)
Italy 5.43 (136) 6.52 (41) 9.09 (59) 8.29 (26) 6.89 (53)
Jamaica 7.92 (22) 5.63 (64) 9.03 (66) 7.19 (71) 7.54 (28)
Japan 5.62 (132) 7.70 (19) 9.79 (3) 8.03 (48) 7.82 (15)
Jordan 7.44 (39) 4.36 (116) 9.83 (2) 7.31 (67) 7.55 (27)
Kazakhstan 7.64 (31) 5.49 (65) 9.15 (49) 6.57 (94) 6.77 (66)
Kenya 7.06 (57) 4.67 (96) 9.31 (35) 6.22 (110) 6.83 (60)
Korea, Rep. 6.29 (98) 6.86 (32) 9.54 (15) 7.37 (63) 7.30 (36)
Kuwait 5.92 (124) 5.12 (79) 8.20 (93) 7.38 (62) 6.54 (82)
Kyrgyz Republic 7.38 (42) 4.61 (101) 8.29 (91) 7.33 (65) 6.77 (69)
Lao PDR 6.94 (62) 4.39 (114) 7.52 (111) 6.76 (84) 5.62 (132)
Latvia 6.01 (115) 7.17 (28) 8.97 (71) 8.66 (8) 7.75 (18)
Lebanon 8.47 (9) 3.43 (138) 4.97 (158) 3.53 (161) 5.32 (142)
Lesotho 5.21 (142) 4.63 (98) 7.84 (107) 6.25 (106) 5.83 (123)
Liberia 6.01 (114) 3.71 (131) 9.07 (61) 5.72 (132) 4.59 (156)
Libya 3.73 (165) 2.51 (155) 7.14 (124) 5.54 (138) 4.31 (160)
Lithuania 6.94 (63) 7.40 (24) 8.97 (70) 8.64 (9) 7.80 (16)
Luxembourg 5.39 (139) 8.64 (7) 9.07 (60) 8.29 (27) 8.14 (9)
Madagascar 7.36 (44) 2.65 (154) 7.93 (106) 6.23 (109) 5.45 (139)
Malawi 6.51 (86) 4.63 (99) 7.38 (112) 4.91 (155) 5.92 (118)
Malaysia 7.27 (47) 5.70 (61) 8.16 (96) 7.26 (69) 7.54 (29)
Mali 6.47 (87) 3.40 (140) 6.92 (135) 6.21 (111) 6.00 (114)
Malta 6.46 (88) 6.78 (36) 9.30 (36) 8.34 (19) 7.78 (17)
Mauritania 5.42 (138) 3.27 (143) 7.96 (105) 6.16 (117) 6.09 (106)
Mauritius 7.71 (27) 7.06 (29) 9.35 (34) 8.13 (41) 6.84 (57)

Mexico 8.15 (16) 4.46 (111) 8.04 (100) 8.13 (42) 6.33 (92)
Moldova 7.84 (24) 5.96 (51) 8.03 (101) 7.63 (57) 6.42 (88)
Mongolia 6.55 (82) 6.05 (49) 8.74 (80) 7.09 (73) 6.76 (70)
Montenegro 6.44 (89) 5.64 (62) 9.61 (8) 8.32 (20) 7.93 (13)
Morocco 6.56 (80) 5.25 (71) 7.21 (118) 6.58 (93) 6.51 (85)
Mozambique 6.89 (66) 4.49 (107) 6.50 (148) 6.46 (102) 5.79 (125)
Myanmar 6.43 (90) 3.02 (149) 6.66 (143) 5.34 (148) 5.19 (144)
Namibia 7.13 (53) 5.73 (60) 6.70 (141) 5.68 (135) 5.54 (135)
Nepal 7.63 (32) 4.90 (86) 6.63 (145) 5.37 (147) 6.97 (50)
Netherlands 4.90 (154) 8.64 (8) 9.10 (58) 8.48 (14) 7.67 (25)
New Zealand 6.15 (108) 9.09 (1) 9.42 (25) 8.53 (13) 8.95 (1)
Nicaragua 6.15 (107) 3.49 (137) 9.59 (10) 7.35 (64) 6.02 (112)
Niger 6.52 (85) 3.56 (134) 7.16 (121) 5.62 (137) 6.14 (101)
Nigeria 8.72 (6) 3.55 (135) 8.81 (79) 5.51 (141) 6.77 (67)
North Macedonia 6.93 (65) 4.74 (94) 8.19 (94) 7.72 (56) 7.69 (24)
Norway 4.97 (149) 9.00 (3) 8.83 (77) 8.24 (33) 7.32 (35)
Oman 5.01 (148) 5.36 (68) 8.69 (82) 7.55 (59) 6.27 (97)
Pakistan 8.24 (14) 3.63 (132) 6.37 (150) 5.91 (126) 5.76 (127)
Panama 7.61 (33) 5.79 (57) 9.36 (33) 8.24 (32) 6.55 (81)
Papua New Guinea 6.04 (112) 4.36 (115) 6.71 (140) 6.74 (86) 6.40 (90)
Paraguay 8.00 (19) 4.35 (117) 9.25 (42) 6.94 (79) 6.57 (80)
Peru 7.61 (34) 5.23 (72) 9.44 (24) 8.17 (37) 7.15 (42)
Philippines 7.91 (23) 4.49 (108) 9.51 (20) 6.53 (97) 6.62 (79)
Poland 5.76 (130) 6.38 (44) 8.09 (98) 8.30 (25) 7.09 (44)
Portugal 6.04 (113) 7.38 (25) 9.17 (48) 8.23 (34) 6.87 (55)
Qatar 5.94 (121) 5.39 (67) 8.32 (90) 6.99 (75) 6.27 (98)
Romania 6.95 (61) 6.78 (35) 9.30 (37) 8.43 (16) 7.03 (48)
Russian Federation 5.92 (123) 4.91 (84) 8.66 (83) 6.33 (105) 5.58 (134)
Rwanda 4.93 (151) 5.88 (54) 9.21 (45) 6.95 (78) 6.85 (56)
Saudi Arabia 4.81 (157) 6.70 (39) 8.86 (76) 6.64 (90) 6.21 (99)
Senegal 7.05 (58) 4.16 (121) 7.14 (123) 6.60 (92) 6.05 (107)
Serbia 5.87 (126) 5.44 (66) 8.02 (102) 8.10 (43) 6.83 (61)
Seychelles 6.38 (96) 6.14 (47) 8.56 (84) 7.74 (55) 6.78 (65)

Sierra Leone 7.10 (55) 4.48 (110) 7.21 (117) 6.00 (124) 4.76 (152)
Singapore 7.26 (49) 8.43 (11) 9.45 (22) 8.94 (2) 8.74 (2)
Slovak Republic 6.22 (102) 6.74 (37) 9.14 (50) 8.29 (28) 7.09 (45)
Slovenia 4.81 (156) 6.84 (34) 9.38 (32) 8.32 (21) 6.81 (63)
Somalia 8.84 (4) 1.88 (165) 7.29 (114) 6.12 (119) 4.20 (161)
South Africa 5.95 (119) 5.76 (59) 8.16 (95) 6.43 (103) 6.35 (91)
Spain 5.88 (125) 7.42 (23) 9.06 (63) 7.99 (52) 7.27 (40)
Sri Lanka 8.28 (13) 4.84 (87) 6.57 (147) 4.88 (156) 6.09 (105)
Sudan 7.37 (43) 2.06 (163) 1.25 (163) 5.20 (149) 4.02 (162)
Suriname 6.27 (100) 4.27 (119) 4.29 (160) 6.48 (101) 6.28 (96)
Sweden 4.73 (159) 8.34 (12) 9.54 (17) 8.59 (10) 7.83 (14)
Switzerland 7.51 (36) 8.96 (4) 9.85 (1) 8.09 (44) 7.97 (12)
Syrian Arab Republic 5.48 (135) 2.30 (159) 4.81 (159) 3.45 (162) 3.47 (163)
Taiwan 7.69 (29) 7.30 (27) 9.56 (13) 7.62 (58) 7.69 (23)
Tajikistan 5.86 (127) 4.01 (123) 9.06 (64) 6.76 (85) 6.21 (100)
Tanzania 5.98 (116) 5.07 (81) 8.38 (89) 5.39 (146) 6.53 (84)
Thailand 6.86 (68) 5.20 (74) 9.76 (4) 6.90 (80) 6.63 (77)
Timor-Leste 5.43 (137) 4.07 (122) 7.22 (116) 7.23 (70) 5.15 (145)
Togo 6.76 (73) 4.83 (88) 7.07 (127) 6.10 (121) 6.43 (87)
Trinidad and Tobago 6.83 (69) 5.05 (82) 9.01 (67) 6.25 (107) 6.00 (115)
Tunisia 5.17 (144) 4.82 (90) 7.99 (104) 6.34 (104) 5.77 (126)
Türkiye 6.65 (77) 4.83 (89) 7.54 (109) 6.87 (81) 5.71 (128)
Uganda 7.02 (59) 4.25 (120) 9.40 (29) 6.23 (108) 6.32 (94)
Ukraine 7.26 (48) 4.58 (104) 6.96 (131) 6.67 (89) 5.36 (141)
United Arab Emirates 5.28 (141) 7.03 (30) 8.99 (69) 8.01 (49) 7.47 (30)
United Kingdom 6.10 (110) 7.99 (15) 9.49 (21) 8.71 (5) 7.75 (19)
United States 7.13 (54) 7.86 (18) 9.38 (31) 8.07 (45) 8.29 (5)
Uruguay 6.39 (94) 5.87 (55) 8.86 (75) 7.50 (61) 6.66 (76)
Venezuela, RB 4.65 (160) 2.29 (161) 0.94 (165) 4.99 (154) 2.17 (165)
Vietnam 6.53 (83) 5.15 (77) 7.02 (128) 6.52 (98) 6.10 (103)
Yemen, Republic 8.35 (10) 2.36 (158) 2.48 (162) 4.65 (158) 3.08 (164)
Zambia 6.13 (109) 4.77 (93) 7.33 (113) 6.07 (122) 4.89 (148)
Zimbabwe 5.08 (146) 3.40 (141) 1.25 (163) 4.81 (157) 4.54 (157)

The EFW Panel Dataset

Over the years, the EFW index has become more comprehensive and the available
data more complete. As a result, the number and composition of the components
and subcomponents for many countries vary across time. This makes it difficult
to directly compare index values from earlier periods with those of later periods.
To assist researchers who are interested in a consistent time-series for a particu-
lar country and/or longitudinal data for a panel of countries, we have developed
the EFW Panel Dataset.
The EFW Panel Dataset is a chain-linked version of the index. It uses the most
recent year as the base year, and changes in a country’s scores backward in time
are based only on changes in components that were present in adjoining years.
The table below demonstrates the procedure using some illustrative numbers.
In the years from 2018 to 2021, Variables 1 and 2 are simply averaged to create a
rating. The problem comes in the period from 2012 to 2017 when Variable 2 is
not available. If we took only the usual raw average of Variable 1 (since there is no
Variable 2), the average would artificially fall by 0.5 points. The chain-linked ver-
sion, though, would base the rating only on the changes in Variable 1, and since
there was no change to Variable 1 in 2017 compared with 2018, the chain-linked
rating would not change from 2018 to 2017. This process is then continued to get
chain-linked ratings backward in time.
Year Variable 1 Variable 2 Raw Average Chain-Linked

2021 6.0 8.0 7.0 7.0
2020 6.0 8.0 7.0 7.0
2019 5.0 7.0 6.0 6.0
2018 5.0 6.0 5.5 5.5
2017 5.0 5.0 5.5
2016 5.0 5.0 5.5
2015 4.0 4.0 4.4
2014 4.0 4.0 4.4
2013 3.0 3.0 3.3
2012 3.0 3.0 3.3
It should be noted that the EFW Panel Dataset contains area and summary
ratings only for those years in which the country received a regular EFW index
rating. Because some data for earlier years may have been updated or corrected,
researchers are always encouraged to use the data from the most recent annual
report to ensure the most reliable figures.
Exhibit 1.4 presents the global average for all nations with complete data since
2000 using the EFW Panel Dataset. Overall, the index shows increases in eco-
nomic freedom since 2000, but the last few years have been rocky. Thanks no
doubt to the coronavirus pandemic, the world average has fallen to 6.77 from 6.94
since 2019—a 0.17 point decline. This erases a decade’s worth of improvement in
the global average and is 2.5 times larger than the global decline witnessed in the
2008/09 financial crisis.

Exhibit 1.4: Average Economic Freedom Rating, 2000–2021

7.0
6.94
6.93
6.91
6.9 6.91
6.86 6.87
6.88
Average rating on EFW index

6.82
6.8 6.79 6.79 6.82
6.76
6.74 6.77 6.77
6.74 6.73
6.7 6.68
6.66
6.62
6.6
6.58 6.59
6.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
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. That is a ques-
tion for epidemiologists and health economists to work out. Our concern is eco-
nomic freedom, and on that margin, there is no question that government policies
responding to the coronavirus pandemic have reduced economic freedom.
Economic freedom and human progress

As is customary, this chapter concludes with some simple graphs illustrating
relationships between economic freedom and various other indicators of human
progress (Exhibits 1.5–1.12). The graphs use the average of the EFW panel dataset
for the period from 2000 to 2021, breaking the data into four quartiles ordered
from least free to most free. Because persistence is important and the impact of
economic freedom will be felt over a lengthy period of time, it is better to use
the average rating over a fairly long time period rather than the current rating to
observe the impact of economic freedom on performance.
The graphs begin with the data on the relationship between economic freedom
and the level of GDP per capita and then go on to examine the correlation with
other economic and social outcomes. Many of the relationships illustrated in the
graphs below reflect the impact of economic freedom as it works through increas-
ing per capita income. We are not necessarily arguing that there is a direct causal
relation between economic freedom and the variables considered below. These
graphics nonetheless provide some insights into the contrast between market-
oriented economies and those dominated by government regulation and planning.
At the very least, these graphs suggest fruitful areas for future research.

Exhibit 1.5: Economic Freedom and Income per Capita

$48,569
48,000
GDP per capita (constant 2017 PPP$)

Countries with
greater economic
36,000
freedom have
substantially
$25,901
higher per-capita 24,000
incomes.
$12,080
12,000
$6,324
0
Least Free Third Second Most Free
Economic Freedom Quartile
Sources: Economic Freedom of the World: 2023 Annual Report; World Bank, 2023, World
Development Indicators [on-line database].
Exhibit 1.6: Economic Freedom and the Income Share of the Poorest 10%
3.0 2.84%
2.74%
The share of
Income share of the poorest 10%
2.5 2.34%
income earned
2.12%
by the poorest
2.0
10% of the
population 1.5
is unrelated
to economic 1.0
freedom.
0.5
0.0

Exhibit 1.7: Economic Freedom and the Income Earned by the Poorest 10%
15,000 $14,204
The amount
poorest 10% (constant 2017 PPP$)

12,000
Annual income per capita of

of income, as
opposed to the
share, earned by 9,000
the poorest 10%
of the population 6,000 $5,654
is much higher
in countries with
3,000 $2,641
higher economic $1,736
freedom.
0
Exhibit 1.8: Economic Freedom and Life Expectancy

90
80.8
Life expectancy at birth, total (years)
Life expectancy 80 76.4

is almost 16 70.0
70 65.0
years longer in
60
countries with the
50
most economic
freedom than it is 40
in countries with 30
the least. 20
10
0

Exhibit 1.9: Economic Freedom and Infant Mortality Rate

40 39.1
The infant
mortality rate 32
Mortality rate, infants

(per 1,000 live births
is almost ten
times higher in 24
21.2
nations in the
lowest quartile 16
of economic
freedom than it is 8.7
8
in nations in the 4.2
highest quartile.
0
Exhibit 1.10: The Effect of Economic Freedom on Poverty Rates

100
Poverty rates
Poverty rate (% of population)
are lower in 80
73.59%
countries with
62.66%
more economic 60
51.86%
freedom.
40.30%
40
31.86%
21.73% 20.58%
20
8.11% 5.53%
3.08% 0.98% 2.13%
0
$2.15 $3.65 $6.85 $2.15 $3.65 $6.85 $2.15 $3.65 $6.85 $2.15 $3.65 $6.85
Note: The columns show, for each quartile, the percentage of a country’s population that
lives on $2.15 per day, $3.65 per day, or $6.85 per day, in 2017 constant PPP-adjusted dollars.

Exhibit 1.11: Economic Freedom and Social Progress

100
Economic freedom 85.6
Rating on Social Progress Index

corresponds with 80 75.0
higher social 64.6
progress, as 60 54.1
measured by
the Social 40
Progress Index.
20
0
Sources: Economic Freedom of the World: 2023 Annual Report; Social Progress
Imperative, 2022, 2022 Social Progress Index.
Exhibit 1.12: Economic Freedom and the UN World Happiness Index

10
People report
that they are 8
UN World Happiness Index
happier in 6.76
6.09
countries 6
with greater 4.61 4.52
economic 4
freedom.
0
Sources: Economic Freedom of the World: 2023 Annual Report; United Nations, World
Happiness Report 2023.

References
Block, Walter E., ed. (1991). Economic Freedom: Toward a Theory of Measurement. Proceedings of
an International Symposium (Volume 2). Fraser Institute. <https://www.fraserinstitute.org/research/
economic-freedom-toward-a-theory-of-measurement>, as of July 6, 2022.
Easton, Stephen T., and Michael A. Walker, eds. (1992). Rating Global Economic Freedom. Fraser
Institute. <https://www.fraserinstitute.org/research/rating-global-economic-freedom>, as of July 6, 2022.
Gwartney, James, Robert Lawson, and Walter Block (1996). Economic Freedom of the World:
1975–1995. Fraser Institute. <https://www.fraserinstitute.org/research/economic-freedom-of-the-
world-1975-1995>, as of July 6, 2021.
Walker, Michael A., ed. (1988). Freedom, Democracy, and Economic Welfare. Proceedings of an
International Symposium (Volume 1). Fraser Institute. <https://www.fraserinstitute.org/research/
freedom-democracy-and-economic-welfare>, as of July 6, 2022.

Chapter 2 Country Data Tables
This chapter presents detailed data on the components used in constructing the
EFW index for the 165 jurisdictions included in this edition of the report. For each
jurisdiction for which data were available, we present the overall EFW index rat-
ing and the rank of that country for the years 1980, 1990, 2000, 2010, 2015, 2019,
2020, and 2021. Like all the ratings in the index, these are values out of 10; 10 is
the highest possible rating and zero (0) is the lowest. A higher rating indicates
a greater degree of economic freedom. Ratings are available for many jurisdic-
tions for 1970, 1975, 1985, 1995, and 2000 to 2018, but these data are not shown in
the tables because of limited space. See <www.fraserinstitute.org/economic-freedom/
dataset> for full data.
Reading the tables

The top row shows the country’s summary rating for each year and, in parentheses,
its overall rank. In the rows below, titles on the left in bold face indicate the five
areas of economic freedom that are combined to generate an overall score. The
cells to their right give the rating for that area for each year. Underneath each area
title are the titles of the components and sub-components that are combined to
generate that area’s score. In these rows, the scores for each year are presented,
where data are available. Shown in italic beside some scores are the actual data
used to derive that particular component rating. For some countries, data for other
components for certain years may be reported even though there were insufficient
data to compute area or summary ratings. A more complete description of each
component, including the methodology used to calculate the ratings, can be found
in the Appendix: Explanatory Notes and Data Sources (pp. 249–262).
Gender Disparity Index

The row in the tables titled “Gender Legal Rights Adjustment” is a composite
index that employs 17 variables to measure legal discrimination against women
and is used to adjust the ratings of Area 2.
For researchers—EFW Panel Dataset

The EFW Panel Dataset is not reported in the following tables but is available at
<www.fraserinstitute.org/economic-freedom/dataset>. See page 17 (in chapter 1) for an
explanation of the EFW Panel Dataset.

Albania 1980 1990 2000 2010 2015 2019 2020 2021

Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank)
Summary Ratings (Rank) 4.68 (87) 6.48 (71) 7.30 (48) 7.67 (38) 7.71 (35) 7.59 (32) 7.60 (31)
x x x x x x x x x x x x x x x x x
Rating (Data) Rating (Data) Rating (Data) Rating (Data) Rating (Data) Rating (Data) Rating (Data) Rating (Data)
1. Size of Government 3.94 4.84 8.19 8.07 7.81 7.91 7.83 7.73
A. Government consumption 7.70 (13.81) 4.87 (23.44) 9.10 (9.07) 8.09 (12.5) 8.19 (12.17) 8.16 (12.26) 8.03 (12.71) 7.76 (13.62)
B. Transfers and subsidies 3.51 (24.3) 7.80 (8.57) 7.39 (10.09) 7.01 (11.49) 7.33 (10.29) 7.05 (11.34) 7.13 (11.02)
C. Government investment 10.00 (3.92) 8.02 (21.93) 8.25 (21.11) 8.11 (21.6) 7.55 (23.59) 7.55 (23.59) 7.55 (23.59)
D. Top marginal tax rate 8.50 8.00 8.00 8.00 8.00
(i) Top marginal income tax rate 10.00 (10) 9.00 (23) 9.00 (23) 9.00 (23) 9.00 (23)
(ii) Top marginal income and payroll tax rate 7.00 (32) 7.00 (34) 7.00 (34) 7.00 (34) 7.00 (34)
E. State ownership of assets 0.18 0.96 7.82 8.14 7.77 8.54 8.54 8.23
2. Legal System and Property Rights 6.23 6.31 4.85 5.50 5.30 5.23 5.24 5.28
A. Judicial independence 3.08 3.14 4.59 4.68 4.65 4.13 4.19 4.48
B. Impartial courts 7.54 6.97 3.77 4.56 4.28 4.44 4.30 4.22
C. Property rights 4.39 4.52 4.61 4.42 4.42 4.42
D. Military interference 8.33 7.78 5.97 8.33 8.33 8.33 8.33 8.33
E. Integrity of the legal system 5.95 5.63 3.83 4.54 4.85 5.27 5.40 5.35
F. Contracts 4.14 3.84 3.44 3.21 3.21 3.42
G. Real property 8.02 7.93 8.09 6.39 6.72 6.72 6.72
H. Police and crime 4.21 5.43 5.86 5.30 5.30 5.30
Gender Legal Rights Adjustment 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
3. Sound Money 6.54 6.91 9.59 9.74 9.80 9.80 9.59
A. Money growth 7.62 (11.88) 9.30 (3.48) 9.93 (-0.37) 9.84 (-0.78) 9.78 (1.08) 9.78 (1.08)
B. Standard deviation of inflation 9.62 (0.95) 5.03 (12.43) 9.75 (0.62) 9.43 (1.43) 9.75 (0.63) 9.69 (0.77) 9.00 (2.5)
C. Inflation 10.00 (0) 9.99 (0.05) 9.29 (3.55) 9.62 (1.89) 9.59 (2.03) 9.72 (1.41) 9.59 (2.04)
D. Foreign currency bank accounts 0.00 0.00 5.00 10.00 10.00 10.00 10.00 10.00
4. Freedom to Trade Internationally 6.75 7.56 8.23 8.53 8.44 8.43
A. Tariffs 6.11 8.45 8.86 9.01 8.98 9.01
(i) Trade tax revenue 5.14 (7.29) 8.57 (2.14) 9.31 (1.03) 9.66 (0.51) 9.57 (0.64) 9.65 (0.53)
(ii) Mean tariff rate 6.60 (17) 9.00 (5) 9.24 (3.8) 9.28 (3.6) 9.28 (3.6) 9.28 (3.6)
(iii) Standard deviation of tariff rates 6.60 (8.5) 7.78 (5.55) 8.02 (4.94) 8.10 (4.75) 8.08 (4.79) 8.10 (4.75)
B. Regulatory trade barriers 6.89 7.73 8.17 8.90 8.90 8.90
(i) Non-tariff trade barriers 6.89 8.01 6.94 8.40 8.40 8.40
(ii) Costs of importing and exporting 7.45 9.41 9.41 9.41 9.41
C. Black-market exchange rates 0.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00
D. Controls of the movement of capital and people 0.00 0.00 4.01 4.05 5.89 6.18 5.87 5.80
(i) Financial openness 4.58 4.58 4.58 4.58 3.32 2.93
(ii) Capital controls 0.00 0.00 1.54 4.62 4.62 4.62 4.62 4.62
(iii) Freedom of foreigners to visit 0.00 8.30 8.63 8.63 8.74
(iv) Protection of foreign assets 5.92 7.02 6.08 6.90 6.90 6.90
5. Regulation 1.05 5.69 5.76 7.24 7.10 6.64 6.97
A. Credit market regulation 0.00 5.82 7.04 9.21 9.53 7.92 9.23
(i) Ownership of banks 0.00 2.00 5.00 10.00 10.00 10.00 10.00
(ii) Private sector credit 6.45 6.12 7.63 8.60 3.77 7.70
(iii) Interest rate controls / negative real interest rates 0.00 9.00 10.00 10.00 10.00 10.00 10.00
B. Labor market regulation 6.89 7.12 7.19 7.12 7.12 7.12
(i) Labor regulations and minimum wage 6.57 6.53 6.53 6.53 6.53 6.53
(ii) Hiring and firing regulations 3.68 4.31 5.65 5.65 5.65 5.65
(iii) Flexible wage determination 6.86 6.09 5.58 5.58 5.58
(iv) Hours regulations 8.00 8.00 8.00 8.00 8.00 8.00
(v) Costs of worker dismissal 5.64 6.30 6.30 6.30 6.30 6.30
(vi) Conscription 0.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00
(vii) Foreign labor 7.46 7.83 7.73 7.76 7.76 7.76
C. Business regulation 1.75 2.10 4.29 5.49 5.50 5.54 5.31 5.31
(i) Regulatory burden 5.68 6.08 5.65 5.65 5.65
(ii) Bureaucracy costs 6.52 6.00 6.67 6.00 6.22
(iii) Impartial public administration 1.75 2.10 4.93 6.12 6.37 6.24 6.00 5.79
(iv) Tax compliance 3.65 3.63 3.54 3.59 3.59 3.59
D. Freedom to compete 5.76 3.38 7.07 6.23 6.23 6.23
(i) Market openness 5.76 6.76 6.81 6.81 6.81 6.81
(ii) Business permits 0.00 7.32 5.62 5.62 5.62
(iii) Distortion of business environment 6.25 6.25 6.25

Chapter 2: Country Data Tables • 25
Algeria 1980 1990 2000 2010 2015 2019 2020 2021

Summary Ratings (Rank) 3.22 (104) 3.22 (109) 4.69 (119) 5.03 (146) 4.70 (157) 4.64 (162) 4.94 (157) 4.82 (157)
B. Transfers and subsidies 8.41 (6.32) 8.19 (7.14) 7.82 (8.51) 7.82 (8.51) 7.82 (8.51) 7.82 (8.51)
C. Government investment 5.00 (32.51) 5.59 (30.42) 3.50 (37.76) 2.41 (41.55) 1.99 (43.04) 4.00 (36.01) 4.00 (36.01) 4.00 (36.01)
D. Top marginal tax rate 4.50 4.50 4.50 4.50
(i) Top marginal income tax rate 7.00 (35) 7.00 (35) 7.00 (35) 7.00 (35)
(ii) Top marginal income and payroll tax rate 2.00 (53) 2.00 (53) 2.00 (53) 2.00 (53)
F. Contracts 4.08 3.44 3.50 3.45 3.45 3.12
G. Real property 6.57 6.06 6.78 6.63 6.63 6.63 6.63
3. Sound Money 5.18 4.35 6.96 7.21 6.89 7.17 7.65 7.08
A. Money growth 8.15 (9.23) 8.77 (6.16) 7.77 (11.13) 8.48 (7.59) 7.18 (-14.1) 6.61 (-16.94) 8.01 (9.96) 8.01 (9.96)
B. Standard deviation of inflation 7.70 (5.75) 5.53 (11.17) 5.14 (12.16) 6.13 (9.67) 6.34 (9.14) 7.93 (5.19) 8.00 (5.01) 6.75 (8.14)
C. Inflation 4.87 (25.66) 3.12 (34.4) 9.93 (0.34) 9.22 (3.91) 9.04 (4.78) 9.15 (4.27) 9.61 (1.95) 8.55 (7.23)
4. Freedom to Trade Internationally 2.55 2.04 5.28 5.74 3.96 2.67 3.76 3.92
A. Tariffs 7.66 5.08 4.95 6.91 6.84 6.87 6.87 6.86
(ii) Mean tariff rate 7.66 (11.7) 5.08 (24.6) 5.08 (24.6) 6.28 (18.6) 6.24 (18.8) 6.22 (18.9) 6.22 (18.9) 6.20 (19)
(ii) Costs of importing and exporting 7.00 7.05 0.00 0.48 0.48 0.48
(i) Financial openness 0.00 2.08 2.08 2.08 2.08 2.07 2.07 1.53
5. Regulation 1.95 2.21 3.64 4.69 5.06 5.12 5.07 4.84
A. Credit market regulation 0.00 0.87 2.26 5.67 5.19 6.19 6.00 5.00
(i) Ownership of banks 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(ii) Private sector credit 1.74 1.78 10.00 5.57 8.57 8.01 8.01
(iii) Interest rate controls / negative real interest rates 5.00 7.00 10.00 10.00 10.00 7.00
(iii) Flexible wage determination 5.17 4.91 5.55 6.52 6.52 6.52
(vi) Conscription 5.00 1.00 1.00 1.00 3.00 3.00 3.00 3.00

Angola 1980 1990 2000 2010 2015 2019 2020 2021

Summary Ratings (Rank) 5.06 (145) 5.45 (144) 5.21 (154) 5.53 (146) 5.38 (149)
1. Size of Government 6.57 6.31 7.53 8.08 7.58 7.73
A. Government consumption 3.91 (26.7) 4.78 (23.74) 7.44 (14.69) 7.58 (14.23) 7.18 (15.59)
B. Transfers and subsidies 7.96 (7.98) 8.89 (4.59) 9.70 (1.59) 9.70 (1.59) 9.70 (1.59)
C. Government investment 8.05 (21.81) 5.68 (30.13) 10.00 (14.46) 9.27 (17.55) 6.63 (26.78) 8.90 (18.85)
F. Contracts 2.16 1.15 1.15 1.15 1.15 1.15
G. Real property 1.35 2.78 5.42 5.52 5.52 5.52
3. Sound Money 5.74 6.99 4.51 6.35 5.79
A. Money growth 7.32 (13.38) 5.80 (20.98) 9.48 (2.6) 7.64 (11.82) 7.03 (14.83) 7.03 (14.83)
B. Standard deviation of inflation 5.06 (12.36) 5.55 (11.14) 4.44 (13.89) 6.78 (8.06) 6.29 (9.27)
C. Inflation 7.11 (14.47) 7.94 (10.28) 5.96 (20.19) 6.58 (17.08) 4.85 (25.75)
D. Foreign currency bank accounts 5.00 5.00 0.00 5.00 5.00
4. Freedom to Trade Internationally 5.87 4.91 5.52 5.51 5.52
A. Tariffs 8.24 6.99 7.12 7.12 7.01
(i) Trade tax revenue 8.89 (1.67) 8.99 (1.51) 9.39 (0.91) 9.39 (0.91) 9.39 (0.91)
(ii) Mean tariff rate 8.54 (7.3) 7.72 (11.4) 7.96 (10.2) 7.96 (10.2) 7.82 (10.9)
(iii) Standard deviation of tariff rates 7.28 (6.79) 4.25 (14.36) 4.00 (14.99) 4.00 (14.99) 3.81 (15.48)
C. Black-market exchange rates 10.00 10.00 9.73 10.00 10.00
D. Controls of the movement of capital and people 2.81 1.80 1.48 2.19 1.88 2.00
(ii) Capital controls 2.31 3.08 2.31 2.31 2.31
5. Regulation 4.13 4.74 5.00 4.81 5.01 4.73
A. Credit market regulation 10.00 8.67 7.73 7.00 7.65 5.98
(i) Ownership of banks 8.00 5.00 5.00 5.00 5.00
(iii) Interest rate controls / negative real interest rates 8.00 9.00 6.00 9.00 4.00
(iv) Hours regulations 4.00 4.00 4.00 4.00 4.00
(v) Costs of worker dismissal 6.26 6.63 6.63 6.63 6.63
(vi) Conscription 0.00 0.00 0.00 0.00 0.00

Argentina 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 6.91 (16.5) 8.53 (11) 6.88 (16.62) 6.14 (19.14) 5.43 (21.54) 5.91 (19.91) 5.61 (20.94) 5.69 (20.65)
B. Transfers and subsidies 7.49 (9.7) 8.17 (7.2) 7.74 (8.8) 6.12 (14.74) 6.05 (15) 6.49 (13.37) 4.89 (19.27) 5.54 (16.88)
D. Top marginal tax rate 6.00 4.00 7.00 5.00 4.00 4.00 4.00 4.00
(i) Top marginal income tax rate 6.00 (45) 7.00 (35) 8.00 (35) 7.00 (35) 7.00 (35) 7.00 (35) 7.00 (35) 7.00 (35)
(ii) Top marginal income and payroll tax rate 1.00 (57) 6.00 (36-43) 3.00 (49) 1.00 (58) 1.00 (57) 1.00 (57) 1.00 (57)
F. Contracts 5.03 4.38 4.38 3.84 3.54 3.38 3.38 3.38
G. Real property 6.74 6.44 6.72 6.86 6.86 6.86 6.86
3. Sound Money 2.50 2.50 9.60 6.65 6.60 4.66 4.12 4.04
A. Money growth 0.00 (115.53) 0.00 (427.46) 9.07 (4.64) 7.77 (11.15) 5.74 (21.29) 5.08 (24.58) 5.08 (24.58) 5.08 (24.58)
C. Inflation 0.00 (92.02) 0.00 (2064.19) 9.81 (-0.94) 4.68 (26.6) 4.72 (26.38) 3.14 (34.3) 0.00 (53.55) 0.58 (47.1)
A. Tariffs 4.05 3.19 7.47 5.59 6.01 6.04 6.17 5.85
(i) Trade tax revenue 3.67 (9.5) 3.40 (9.9) 7.92 (3.12) 3.51 (9.73) 4.71 (7.93) 4.93 (7.61) 5.32 (7.02) 4.42 (8.36)
(ii) Mean tariff rate 4.44 (27.8) 5.90 (20.5) 7.48 (12.6) 7.48 (12.6) 7.28 (13.6) 7.30 (13.5) 7.32 (13.4) 7.32 (13.4)
(iii) Standard deviation of tariff rates 0.28 (24.3) 7.00 (7.5) 5.77 (10.58) 6.03 (9.93) 5.90 (10.26) 5.87 (10.32) 5.82 (10.45)
5. Regulation 3.02 4.28 5.98 5.21 5.54 5.54 5.34 5.30
(ii) Private sector credit 8.34 6.09 6.95 5.72 5.29 7.17 5.38 6.80
(iii) Interest rate controls / negative real interest rates 0.00 0.00 10.00 5.00 10.00 8.00 7.00 5.00
B. Labor market regulation 3.73 3.46 5.37 5.89 5.51 5.78 5.78 5.80
(ii) Hiring and firing regulations 3.00 1.29 1.78 3.76 3.76 3.76 3.94
(iii) Flexible wage determination 5.18 5.18 4.83 2.91 3.35 3.19 3.19 3.19
(iv) Hours regulations 5.01 4.66 6.01 10.00 10.00 10.00 10.00 10.00
(vi) Conscription 1.00 1.00 10.00 10.00 10.00 10.00 10.00 10.00
(i) Regulatory burden 6.78 2.43 2.05 2.71 2.71 2.71
(ii) Bureaucracy costs 7.50 5.30 4.44 5.78 5.56 5.11

Armenia 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 7.72 (13.75) 7.54 (14.38) 7.94 (13) 6.89 (16.58) 6.47 (17.99)
E. State ownership of assets 3.63 7.92 8.84 9.07 9.07 9.07 8.04
2. Legal System and Property Rights 4.08 5.06 5.40 5.45 5.93 5.92 5.92
B. Impartial courts 5.01 3.39 3.66 3.74 4.94 4.78 4.71
D. Military interference 6.67 5.83 5.83 5.83 5.83 5.00
E. Integrity of the legal system 4.76 4.55 4.36 4.33 5.37 5.77 6.25
F. Contracts 5.24 4.83 3.85 3.85 3.85 4.06
G. Real property 9.72 9.83 9.80 9.82 9.82 9.82
3. Sound Money 9.00 9.21 9.47 9.54 9.12
A. Money growth 6.92 (15.38) 8.93 (5.33) 8.46 (7.69) 8.70 (6.51) 8.78 (6.12) 8.78 (6.12)
C. Inflation 8.36 (8.18) 9.25 (3.73) 9.50 (2.52) 9.71 (1.44) 8.56 (7.18)
A. Tariffs 8.90 8.68 8.43 8.43 8.62
5. Regulation 4.50 6.63 6.99 7.18 7.11 6.94
A. Credit market regulation 8.83 9.00 9.68 9.68 9.07
(ii) Private sector credit 7.50 6.99 9.05 9.05 7.21
(vi) Conscription 0.00 0.00 0.00 0.00 0.00
C. Business regulation 5.79 1.80 3.79 5.14 5.93 5.64 5.56
(iii) Impartial public administration 5.79 3.60 4.67 4.68 6.96 6.26 6.37

Australia 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 7.38 (10.1) 7.22 (10.7) 7.09 (11.17) 6.80 (12.23) 6.66 (12.74) 6.96 (11.64) 5.77 (16.03) 5.16 (18.27)
(ii) Top marginal income and payroll tax rate 3.00 (49) 3.00 (49) 5.00 (47) 5.00 (49) 4.00 (47) 4.00 (47) 4.00 (47)
F. Contracts 9.00 8.72 8.72 7.99 7.89 7.84 7.84 7.84
G. Real property 8.39 7.57 8.29 8.21 8.14 8.14 8.14
3. Sound Money 9.09 9.02 9.47 9.34 9.50 9.54 9.52 9.53
A. Money growth 8.91 (5.44) 7.53 (12.34) 9.47 (2.63) 8.59 (7.03) 9.38 (3.08) 9.36 (3.18) 9.05 (4.73) 9.05 (4.73)
C. Inflation 8.03 (9.84) 9.35 (3.26) 9.10 (4.48) 9.43 (2.85) 9.70 (1.51) 9.62 (1.91) 9.68 (1.61) 9.43 (2.86)
A. Tariffs 7.35 6.46 8.43 8.83 8.97 9.13 9.03 9.06
5. Regulation 8.58 8.67 8.57 8.52 8.53 8.30 8.08 8.12
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Austria 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 7.60 7.60 7.60 7.38 7.07 7.16 7.16 7.16
G. Real property 7.92 7.92 7.92 8.10 8.10 8.10 8.10
3. Sound Money 8.40 9.63 9.63 9.64 9.62 9.40 9.17 9.12
A. Money growth 9.97 (-0.17) 9.46 (2.69) 9.18 (4.1) 9.19 (4.06) 8.76 (6.2) 8.14 (9.3) 7.20 (14.02) 7.20 (14.02)
C. Inflation 9.00 (5) 9.31 (3.45) 9.53 (2.35) 9.64 (1.81) 9.82 (0.9) 9.60 (2) 9.69 (1.53) 9.45 (2.77)
A. Tariffs 8.61 7.92 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 6.88 7.05 7.62 7.54 7.55 7.54 7.16 7.28
(vi) Conscription 5.00 5.00 3.00 3.00 3.00 3.00 3.00 3.00

Azerbaijan 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 4.12 (26) 6.48 (17.96) 7.05 (16.03) 5.64 (20.83) 5.77 (20.38)
F. Contracts 6.12 6.28 6.13 6.13 6.13 6.13
G. Real property 8.72 9.73 9.77 7.61 7.61 7.61
3. Sound Money 6.44 7.24 7.33 7.28 6.92
A. Money growth 6.32 (18.38) 7.75 (11.26) 9.41 (2.93) 9.00 (5) 8.76 (6.21) 8.76 (6.21)
C. Inflation 8.87 (5.67) 9.17 (4.17) 9.62 (1.92) 9.48 (2.61) 8.67 (6.65)
A. Tariffs 8.13 7.94 7.52 7.48 7.58
5. Regulation 4.52 6.04 6.17 6.45 6.15 6.44
(vi) Conscription 1.00 1.00 1.00 1.00 1.00

Bahamas, The 1980 1990 2000 2010 2015 2019 2020 2021
B. Transfers and subsidies 10.00 (0.5) 9.86 (1) 8.97 (4.29) 8.97 (4.28) 9.04 (4.02) 8.96 (4.32) 8.62 (5.55) 7.97 (7.96)
(ii) Top marginal income and payroll tax rate 10.00 (5-9) 10.00 (10) 10.00 (9) 10.00 (9) 10.00 (9) 10.00 (9)
B. Impartial courts 7.70 7.17 7.06 6.60 6.31 6.35
F. Contracts 4.00 4.00 3.60 3.55 3.55 3.55
G. Real property 4.98 6.15 3.82 3.82 3.82
3. Sound Money 6.33 6.90 6.90 7.16 7.11 8.27 6.68 6.65
A. Money growth 8.72 (6.41) 8.90 (5.51) 8.18 (9.1) 9.37 (3.17) 9.99 (0.06) 9.63 (1.85) 9.63 (1.85) 9.63 (1.85)
C. Inflation 8.00 (10.01) 9.37 (3.16) 9.79 (1.04) 9.73 (1.34) 9.63 (1.87) 9.55 (2.27) 9.50 (2.49) 9.42 (2.9)
A. Tariffs 4.32 3.60 3.33 3.27 3.33 3.96 3.19 4.16
(ii) Mean tariff rate 4.04 (29.8) 3.00 (35) 2.82 (35.9) 3.22 (33.9) 3.50 (32.5) 3.50 (32.5) 3.50 (32.5)
B. Regulatory trade barriers 7.76 8.11 4.05 4.05 4.05
(i) Non-tariff trade barriers 0.00 0.00 0.00
(iv) Protection of foreign assets 5.00 5.00 5.00
5. Regulation 8.50 8.11 7.61 7.15 7.33 6.88
(iii) Flexible wage determination
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
(vii) Foreign labor 5.00 5.00 5.00
C. Business regulation 7.67 6.94 5.81 4.14 6.20 6.20
(i) Regulatory burden 0.00
(iii) Impartial public administration

Bahrain 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 10.00 (0) 10.00 (17) 10.00 (17) 10.00 (17) 10.00 (17) 10.00 (17)
F. Contracts 4.89 4.89 4.89 4.89 4.89 4.89
G. Real property 9.12 8.86 9.40 9.40 9.40
3. Sound Money 8.68 8.83 9.03 8.30 9.18 9.28 9.50 9.39
A. Money growth 9.78 (-1.1) 9.35 (3.24) 8.18 (9.12) 9.95 (0.27) 9.95 (0.27) 9.95 (0.27) 9.95 (0.27)
C. Inflation 9.22 (3.9) 8.63 (6.84) 9.86 (-0.7) 9.61 (1.96) 9.63 (1.84) 9.58 (2.08) 9.80 (1.01) 9.88 (-0.61)
A. Tariffs 9.39 9.27 9.19 8.22 8.61 8.40 8.36 8.34
5. Regulation 6.35 6.24 7.93 8.24 7.85 7.40 7.38 7.38
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Bangladesh 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.21 0.58 0.47 0.47 0.47 0.47
G. Real property 1.35 1.35 2.02 3.09 2.67 2.67 2.67
3. Sound Money 4.57 6.63 6.93 6.53 6.74 6.92 6.90 6.92
A. Money growth 6.75 (16.27) 8.33 (8.34) 8.69 (6.54) 8.25 (8.76) 8.66 (6.69) 9.11 (4.43) 9.19 (4.06) 9.19 (4.06)
C. Inflation 7.32 (13.39) 9.03 (4.87) 9.56 (2.21) 8.37 (8.13) 8.76 (6.19) 8.89 (5.54) 8.88 (5.59) 8.89 (5.55)
A. Tariffs 0.53 0.64 5.19 6.41 6.54 7.14 7.08 6.98
(i) Trade tax revenue 1.07 (13.4) 1.93 (12.1) 5.33 (7) 5.65 (6.52) 6.24 (5.64) 7.97 (3.04) 7.79 (3.31) 7.50 (3.75)
(ii) Mean tariff rate 0.00 (99.9) 0.00 (102.2) 5.68 (21.6) 7.06 (14.7) 7.22 (13.9) 7.20 (14) 7.20 (14) 7.20 (14)
5. Regulation 3.09 4.45 5.49 6.02 5.96 5.59 5.59 5.67
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Barbados 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 10.00 (0.2) 10.00 (0.5) 10.00 (0) 6.23 (14.35) 5.95 (15.38) 6.65 (12.81) 6.65 (12.81) 6.65 (12.81)
D. Military interference
F. Contracts 1.90 1.90 1.90 1.90 1.90 2.09
G. Real property 4.71 6.17 7.58 7.58 7.58
3. Sound Money 5.16 6.52 7.03 6.57 7.13 8.16 8.12 8.38
A. Money growth 7.58 (12.11) 8.53 (7.36) 9.21 (3.94) 9.18 (4.09) 9.45 (-2.77) 9.53 (2.34) 9.53 (2.34) 9.53 (2.34)
C. Inflation 5.49 (22.56) 8.91 (5.45) 9.51 (2.44) 8.84 (5.82) 9.79 (-1.06) 9.27 (3.67) 9.18 (4.1) 9.40 (3)
A. Tariffs 7.53 6.06 6.20 5.80 7.12 7.17 7.17 5.86
(i) Trade tax revenue 7.53 (3.7) 7.60 (3.6) 8.35 (2.47) 7.86 (3.21) 8.01 (2.99) 8.01 (2.99) 8.01 (2.99)
(ii) Mean tariff rate 6.20 (19) 7.30 (13.5) 7.86 (10.7) 7.86 (10.7) 7.86 (10.7) 7.66 (11.7)
(ii) Costs of importing and exporting 5.29 6.16 6.16 6.16
5. Regulation 7.49 7.85 7.15 6.15 6.06 7.04 7.04 7.05
(iv) Hours regulations 8.00 8.00 8.00 8.00
(v) Costs of worker dismissal 5.68 5.68 5.68 5.68
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
(ii) Business permits 5.00 5.00 5.00 5.00

Belarus 1980 1990 2000 2010 2015 2019 2020 2021

Summary Ratings (Rank) 5.20 (152) 6.41 (106) 6.44 (97) 6.23 (109)
1. Size of Government 5.59 6.83 6.79 6.79 6.31 6.19 7.73
A. Government consumption 4.78 (23.76) 4.49 (24.73) 4.60 (24.37)
B. Transfers and subsidies 5.49 (17.07) 5.72 (16.2) 5.72 (16.2)
D. Top marginal tax rate 7.50 7.50 7.50
(i) Top marginal income tax rate 10.00 (13) 10.00 (13) 10.00 (13)
(ii) Top marginal income and payroll tax rate 5.00 (36) 5.00 (36) 5.00 (36)
F. Contracts 3.57 3.67 3.49 3.49 3.49 3.49
G. Real property 5.60 9.66 9.94 9.91 9.91 9.91
3. Sound Money 4.37 9.01 9.16 8.92
A. Money growth 0.00 (127.13) 6.68 (16.58) 5.83 (20.86) 8.56 (7.22) 8.39 (8.05) 8.39 (8.05)
B. Standard deviation of inflation 0.00 (29.97) 8.47 (3.83) 9.37 (1.57) 9.19 (2.03)
C. Inflation 7.29 (13.53) 9.03 (4.87) 8.88 (5.6) 8.11 (9.46)
D. Foreign currency bank accounts 10.00 10.00 10.00
4. Freedom to Trade Internationally 6.39 6.66 6.20
A. Tariffs 7.81 7.89 7.95
(i) Trade tax revenue 8.20 (2.7) 8.45 (2.32) 8.45 (2.32)
(ii) Mean tariff rate 8.64 (6.8) 8.64 (6.8) 8.66 (6.7)
(iii) Standard deviation of tariff rates 6.60 (8.5) 6.57 (8.57) 6.73 (8.17)
B. Regulatory trade barriers 6.10 6.10 6.10
(ii) Costs of importing and exporting 9.70 9.70 9.70
C. Black-market exchange rates 10.00 10.00 10.00
(ii) Capital controls 1.54 1.54 1.54
(iii) Freedom of foreigners to visit 1.77 2.99 7.01 0.00
5. Regulation 4.57 5.16 5.15 5.83 5.82 5.51
A. Credit market regulation 2.00 7.33 6.66 6.66
(i) Ownership of banks 2.00 2.00 2.00 2.00
(ii) Private sector credit 10.00 8.97 8.97
(iii) Interest rate controls / negative real interest rates 10.00 9.00 9.00
(iv) Hours regulations 10.00 10.00 10.00
(v) Costs of worker dismissal 7.76 7.76 7.76
(vi) Conscription 1.00 1.00 1.00
(ii) Bureaucracy costs 6.44 6.00 4.22
(ii) Business permits 8.34 8.34 8.34

Belgium 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 3.05 (26) 3.32 (25) 3.81 (23.21) 2.43 (28.29) 2.01 (29.82) 2.05 (29.67) 0.63 (34.89) 1.49 (31.73)
(i) Top marginal income tax rate 0.00 (76) 2.00 (55-61) 2.00 (58-62.7) 2.00 (50-55) 2.00 (50-55) 2.00 (50-55) 2.00 (50-55) 2.00 (50-55)
(ii) Top marginal income and payroll tax rate 0.00 (70) 0.00 (70.8) 0.00 (68-71) 0.00 (67-70) 0.00 (66-69) 0.00 (66-69) 0.00 (66-69)
F. Contracts 8.33 8.33 8.33 7.13 6.86 6.86 6.86 6.86
G. Real property 3.30 3.30 4.33 4.77 4.90 4.90 4.90
3. Sound Money 9.58 9.74 9.62 9.69 9.66 9.38 9.20 9.10
A. Money growth 9.78 (1.1) 9.97 (0.17) 9.10 (4.48) 9.35 (3.25) 9.00 (5.01) 8.03 (9.83) 7.13 (14.34) 7.13 (14.34)
C. Inflation 9.16 (4.18) 9.37 (3.14) 9.49 (2.54) 9.56 (2.19) 9.89 (0.56) 9.59 (2.05) 9.71 (1.44) 9.51 (2.44)
A. Tariffs 9.02 8.46 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.21 7.19 7.98 7.94 7.81 7.85 7.56 7.70
(vi) Conscription 3.00 3.00 10.00 10.00 10.00 10.00 10.00 10.00

Belize 1980 1990 2000 2010 2015 2019 2020 2021

Summary Ratings (Rank) 5.69 (97) 6.14 (112) 6.29 (111) 6.29 (114) 5.94 (128) 5.91 (126)
(ii) Top marginal income and payroll tax rate
2. Legal System and Property Rights 3.99 4.05 3.93 3.93 3.89 3.89
E. Integrity of the legal system
F. Contracts 1.66 1.66 1.66 1.66 1.66 1.66
G. Real property 7.32 7.32 7.29 7.29 7.29 7.29
3. Sound Money 6.47 6.89 6.80 7.11 7.17 7.37 7.07 6.85
A. Money growth 9.65 (1.74) 8.82 (5.88) 9.04 (4.81) 9.31 (3.43) 9.33 (3.37) 9.97 (0.16) 9.27 (3.66) 9.27 (3.66)
C. Inflation 7.72 (11.4) 9.95 (0.26) 9.88 (0.61) 9.82 (0.89) 9.82 (-0.89) 9.94 (0.3) 9.96 (0.19) 9.35 (3.24)
A. Tariffs 4.20 2.80 5.61 6.48 6.35 6.41 6.41 6.40
(i) Trade tax revenue 4.20 (8.7) 2.80 (10.8) 5.61 (6.59) 6.67 (5) 6.15 (5.77) 7.47 (3.79) 7.47 (3.79) 7.47 (3.79)
(ii) Mean tariff rate 7.80 (11) 7.82 (10.9) 7.62 (11.9) 7.62 (11.9) 7.62 (11.9)
(i) Financial openness 4.16 1.66 3.33 3.33 3.32 3.32 3.32
5. Regulation 7.19 7.49 6.95 6.51 6.69 6.69
(iii) Flexible wage determination 7.12
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
(vii) Foreign labor 3.84 4.42 4.42 4.42 4.42

Benin 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 9.35 (8.22) 8.34 (11.66) 7.45 (14.68) 8.09 (12.5) 7.89 (13.18) 7.90 (13.13) 7.54 (14.35) 7.94 (13)
F. Contracts 2.19 0.53 0.53 1.02 1.02 1.02
G. Real property 3.75 4.09 3.85 3.95 6.61 6.61 6.61
3. Sound Money 6.09 6.65 6.75 6.69 6.91 7.32 7.22 7.15
A. Money growth 7.64 (11.81) 9.50 (2.49) 8.58 (7.1) 8.29 (8.53) 8.84 (5.8) 9.55 (-2.27) 9.58 (-2.08) 9.58 (-2.08)
C. Inflation 7.96 (10.19) 8.78 (6.11) 9.17 (4.17) 9.54 (2.31) 9.94 (0.32) 9.80 (1.02) 9.82 (-0.92) 9.65 (1.73)
4. Freedom to Trade Internationally 5.05 5.94 5.82 5.70 6.11 5.75 5.71
A. Tariffs 2.93 7.60 6.80 6.81 6.82 6.82 6.82
5. Regulation 4.19 4.88 5.31 5.48 5.71 6.79 6.79 6.79
(vi) Conscription 1.00 1.00 1.00 1.00 1.00 1.00 1.00

Bhutan 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 9.87 (0.99) 9.87 (0.99) 9.46 (2.47) 9.46 (2.47)
F. Contracts 4.20 6.88 6.18 6.18 6.18 6.18
G. Real property 8.31 8.79 6.90 6.90 6.90 6.90
3. Sound Money 7.01 6.84 6.64 6.40
A. Money growth 8.35 (8.23) 6.42 (17.91) 8.44 (7.82) 9.84 (0.8) 8.62 (6.88) 8.09 (9.57) 8.09 (9.57)
C. Inflation 9.10 (4.52) 9.46 (2.72) 9.45 (2.73) 8.53 (7.35)
D. Foreign currency bank accounts 0.00 0.00 0.00 0.00
4. Freedom to Trade Internationally 6.34 6.39 6.41 6.83
A. Tariffs 6.28 6.19 6.34 7.97
(i) Trade tax revenue 9.11 (1.34) 8.84 (1.74) 9.20 (1.2) 9.20 (1.2)
(ii) Mean tariff rate 5.54 (22.3) 5.54 (22.3) 5.58 (22.1) 8.06 (9.7)
(iii) Standard deviation of tariff rates 4.20 (14.5) 4.20 (14.5) 4.25 (14.37) 6.66 (8.34)
C. Black-market exchange rates 10.00 10.00 10.00 10.00
D. Controls of the movement of capital and people 3.33 3.33 4.06 1.93 2.03 1.95 2.02
(ii) Capital controls 0.00 0.00 0.00 0.00
(iv) Protection of foreign assets 4.80 4.06 4.47 4.47 4.47
5. Regulation 5.35 6.50 7.35 7.06 7.21 7.18
(iii) Interest rate controls / negative real interest rates 9.00 9.00 9.00 9.00
(vi) Conscription 10.00 10.00 10.00 10.00
(i) Regulatory burden 4.47 0.00 2.54 2.54

Bolivia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.25 3.25 3.25 3.50 3.50 3.50
G. Real property 6.58 6.62 6.68 6.75 6.75 6.75 6.75
3. Sound Money 5.35 4.90 9.24 8.90 8.68 9.38 9.48 9.55
A. Money growth 7.03 (14.83) 2.85 (35.77) 9.21 (3.96) 8.39 (8.04) 8.30 (8.48) 9.65 (-1.73) 9.68 (1.58) 9.68 (1.58)
C. Inflation 0.54 (47.3) 6.75 (16.26) 9.08 (4.6) 9.50 (2.5) 9.19 (4.06) 9.55 (2.27) 9.63 (1.84) 9.85 (0.74)
A. Tariffs 4.80 7.56 8.62 7.92 7.77 7.70 7.70 7.70
(ii) Mean tariff rate 6.66 (16.7) 8.10 (9.5) 7.76 (11.2) 7.68 (11.6) 7.64 (11.8) 7.64 (11.8) 7.64 (11.8)
5. Regulation 1.56 7.03 5.02 5.34 4.65 4.76 4.75 4.81
(v) Costs of worker dismissal 0.00
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Bosnia & Herzegovina 1980 1990 2000 2010 2015 2019 2020 2021
E. State ownership of assets 5.78 7.33 7.18 6.85 6.85 6.94
F. Contracts 4.64 3.07 3.15 3.15 3.15 3.15
G. Real property 3.03 6.70 7.84 7.66 7.66 7.66
3. Sound Money 8.14 8.45 8.36 8.35 8.21
A. Money growth 4.12 (29.38) 9.40 (2.99) 9.29 (3.56) 8.97 (5.14) 8.91 (5.44) 8.91 (5.44)
C. Inflation 9.56 (2.19) 9.83 (-0.85) 9.72 (1.42) 9.89 (0.56) 9.60 (1.98)
A. Tariffs 8.44 8.57 8.45 8.45 8.16
(i) Trade tax revenue 10.00 (0) 10.00 (0) 9.87 (0.2) 9.98 (0.02) 10.00 (0)
5. Regulation 5.77 6.77 6.96 6.82 6.62 6.77
(vi) Conscription 10.00 10.00 10.00 10.00 10.00
(iii) Impartial public administration 4.49 4.72 4.72 2.19 2.62 2.89

Botswana 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 10.00 (0) 6.71 (26.53) 2.22 (42.22) 3.16 (38.94) 6.84 (26.05) 7.82 (22.64) 7.82 (22.64) 7.82 (22.64)
F. Contracts 6.40 4.29 4.17 4.04 4.04 3.74
G. Real property 8.05 7.02 8.05 8.10 7.81 7.81 7.81
3. Sound Money 5.15 5.77 8.93 8.27 9.31 9.32 9.26 9.28
A. Money growth 7.99 (10.03) 7.73 (11.36) 9.20 (4.02) 8.39 (8.05) 8.95 (5.27) 9.71 (1.47) 9.39 (3.05) 9.39 (3.05)
C. Inflation 6.18 (19.08) 8.79 (6.03) 8.28 (8.6) 8.61 (6.95) 9.39 (3.06) 9.35 (3.24) 9.45 (2.77) 8.55 (7.24)
A. Tariffs 4.79 6.29 6.84 5.98 5.73 5.92 5.66 6.32
(ii) Mean tariff rate 8.12 (9.4) 7.80 (11) 8.56 (7.2) 8.46 (7.7) 8.48 (7.6) 8.46 (7.7) 8.46 (7.7) 8.46 (7.7)
(iii) Standard deviation of tariff rates 5.48 (11.3) 6.00 (10) 5.07 (12.32) 5.53 (11.17) 5.53 (11.17) 5.53 (11.17) 5.63 (10.93)
5. Regulation 7.48 7.41 6.16 6.29 6.62 5.98 5.86 6.05
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Brazil 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 8.34 (11.65) 4.55 (24.55) 4.44 (24.9) 4.71 (24) 4.82 (23.6) 4.76 (23.8) 4.52 (24.63) 4.75 (23.85)
(i) Top marginal income tax rate 4.00 (55) 9.00 (25) 8.00 (27.5) 8.00 (28) 8.00 (28) 8.00 (28) 8.00 (28) 8.00 (28)
F. Contracts 5.95 4.71 3.97 3.77 3.33 3.05 3.05 3.05
G. Real property 8.09 7.80 8.32 8.39 8.24 8.24 8.24
3. Sound Money 1.58 0.00 6.09 7.79 7.82 9.27 9.22 8.87
A. Money growth 2.95 (35.26) 0.00 (564.97) 7.88 (10.62) 7.85 (10.77) 8.49 (7.53) 8.82 (5.91) 8.47 (7.65) 8.47 (7.65)
C. Inflation 0.00 (87.47) 0.00 (2509.47) 8.59 (7.04) 8.99 (5.04) 8.19 (9.03) 9.27 (3.66) 9.25 (3.73) 8.34 (8.3)
A. Tariffs 3.33 4.84 7.18 7.20 7.26 7.36 7.40 7.42
(i) Trade tax revenue 3.33 (10) 7.53 (3.7) 7.21 (4.18) 8.29 (2.57) 8.37 (2.44) 8.63 (2.06) 8.73 (1.9) 8.79 (1.81)
(ii) Mean tariff rate 4.00 (30) 7.12 (14.4) 7.26 (13.7) 7.30 (13.5) 7.32 (13.4) 7.34 (13.3) 7.34 (13.3)
5. Regulation 3.85 4.88 5.30 5.19 4.76 5.18 4.93 5.59
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Brunei Darussalam 1980 1990 2000 2010 2015 2019 2020 2021
1. Size of Government 5.00 6.33 6.67 6.67 6.67
C. Government investment 8.98 (18.57) 10.00 (5.15) 10.00 (3.48) 10.00 (2.4)
(ii) Top marginal income and payroll tax rate 10.00 (8.5) 10.00 (7) 10.00 (7) 10.00 (7) 10.00 (7)
F. Contracts 4.59 4.59 4.59 4.59 4.59 4.59
G. Real property 4.80 4.80 4.80 4.80 4.80 4.80
3. Sound Money 8.54 8.49 8.80 9.05 8.82
A. Money growth 3.52 (32.38) 9.77 (1.15) 9.61 (1.93) 9.73 (1.35) 9.79 (1.04) 9.79 (1.04)
C. Inflation 9.93 (0.36) 9.92 (0.42) 9.79 (1.03) 9.92 (-0.39) 9.65 (1.73)
A. Tariffs 8.70 9.24 9.45 9.64 9.44
D. Controls of the movement of capital and people 5.86 5.51 6.92 5.62 5.48
(i) Financial openness 10.00 10.00 9.45
5. Regulation 6.92 7.69 7.86 8.04 8.04 7.66
(i) Ownership of banks
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Bulgaria 1980 1990 2000 2010 2015 2019 2020 2021

D. Top marginal tax rate 3.00 7.50 8.50 8.50 8.50 8.50
(i) Top marginal income tax rate 5.00 (38) 10.00 (10) 10.00 (10) 10.00 (10) 10.00 (10) 10.00 (10)
F. Contracts 4.40 3.63 3.63 3.79 3.79 3.79
G. Real property 8.85 8.88 8.96 8.84 8.72 8.72 8.72
3. Sound Money 3.47 3.23 9.22 9.59 9.51 9.45 9.40
A. Money growth 0.00 (50.41) 8.73 (6.33) 9.23 (3.86) 9.12 (4.42) 8.86 (5.69) 8.86 (5.69)
C. Inflation 4.76 (26.19) 7.94 (10.32) 9.51 (2.44) 9.98 (-0.1) 9.44 (2.81) 9.38 (3.1) 9.34 (3.3)
A. Tariffs 8.43 7.85 9.15 8.36 8.20 8.03 8.06
5. Regulation 2.39 4.92 6.65 7.30 7.28 7.25 7.29 7.02
(vi) Conscription 0.00 0.00 3.00 10.00 10.00 10.00 10.00 10.00

Burkina Faso 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 2.30 2.30 2.32 2.32 2.32 2.32
G. Real property 2.98 4.55 4.76 4.82 4.82 4.82
3. Sound Money 6.76 6.90 6.78 6.71 6.67
A. Money growth 3.12 (34.38) 7.94 (10.32) 8.74 (6.28) 9.01 (4.96) 8.72 (6.38) 8.72 (6.38)
C. Inflation 9.85 (-0.76) 9.81 (0.95) 9.63 (1.86) 9.35 (-3.23) 9.27 (3.65)
A. Tariffs 7.31 7.37 7.44 7.44 7.44
5. Regulation 5.12 6.54 6.46 6.81 6.73 6.81
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Burundi 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 2.61 1.33 1.33 1.40 1.40 1.40
G. Real property 3.22 3.22 6.15 8.51 8.55 8.55 8.55
3. Sound Money 5.54 6.22 6.02 7.00 7.81 8.67 8.47 8.06
A. Money growth 7.84 (10.8) 8.85 (5.74) 6.98 (15.09) 7.47 (12.65) 8.99 (5.03) 7.38 (13.09) 6.63 (16.86) 6.63 (16.86)
C. Inflation 6.72 (16.38) 8.80 (5.99) 5.14 (24.31) 8.72 (6.4) 8.89 (5.55) 9.44 (-2.81) 9.86 (-0.69) 8.32 (8.4)
A. Tariffs 0.00 1.30 1.13 4.64 4.47 6.38 6.09 5.88
5. Regulation 3.46 4.01 4.16 5.63 5.54 5.49 5.53 5.51
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Cabo Verde 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 5.47 5.47 5.53 5.53 5.53 5.53
G. Real property 6.09 6.12 8.83 8.92 8.92 8.92
3. Sound Money 7.25 8.42 9.76 9.69 9.64
A. Money growth 2.72 (36.38) 9.85 (-0.77) 9.53 (2.34) 9.63 (1.84) 9.40 (3.02) 9.40 (3.02)
C. Inflation 9.58 (2.08) 9.97 (0.13) 9.75 (1.26) 9.78 (1.11) 9.63 (1.86)
A. Tariffs 6.60 6.80 6.78 6.49 6.49
(ii) Mean tariff rate 7.96 (10.2) 8.00 (10) 7.96 (10.2) 7.96 (10.2) 7.96 (10.2)
5. Regulation 5.60 6.83 6.64 6.90 6.74 6.74
(vi) Conscription 1.00 1.00 1.00 1.00 1.00

Cambodia 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 4.30 (34.95) 2.86 (40) 8.22 (21.24) 8.79 (19.25) 8.79 (19.25) 8.79 (19.25)
F. Contracts 2.47 2.47 2.16 2.16 2.16 2.16
G. Real property 7.40 7.50 7.53 7.55 7.55 7.55
3. Sound Money 8.84 9.21 9.24 9.17 9.13
A. Money growth 2.52 (37.38) 7.75 (11.26) 7.43 (12.84) 7.81 (10.95) 7.82 (10.89) 7.82 (10.89)
C. Inflation 9.20 (4) 9.76 (1.22) 9.51 (2.46) 9.60 (2.01) 9.42 (2.92)
A. Tariffs 8.55 7.62 7.60 7.82 7.89
5. Regulation 3.78 5.45 5.71 5.90 5.77 5.66
(vi) Conscription 5.00 5.00 5.00 5.00 5.00

Cameroon 1980 1990 2000 2010 2015 2019 2020 2021

D. Top marginal tax rate 0.50 0.00 4.50 4.50 4.50 4.50 4.50
(i) Top marginal income tax rate 1.00 (60) 0.00 (65) 5.00 (39) 5.00 (39) 5.00 (39) 5.00 (39) 5.00 (39)
F. Contracts 3.17 2.33 2.33 2.33 2.33 2.33
G. Real property 3.24 3.24 3.24 3.37 3.97 3.97 3.97
3. Sound Money 5.56 7.02 6.78 6.80 7.12 7.22 7.16 7.16
A. Money growth 7.46 (12.7) 9.01 (-4.96) 8.05 (9.76) 8.59 (7.05) 9.46 (2.69) 9.52 (2.42) 9.52 (2.42) 9.52 (2.42)
C. Inflation 7.15 (14.25) 9.67 (1.64) 9.75 (1.23) 9.74 (1.28) 9.46 (2.69) 9.79 (1.07) 9.51 (2.45) 9.55 (2.27)
A. Tariffs 2.67 6.40 5.08 5.50 6.72 6.68 6.57 6.57
(ii) Mean tariff rate 6.32 (18.4) 6.44 (17.8) 6.36 (18.2) 6.36 (18.2) 6.36 (18.2) 6.36 (18.2)
5. Regulation 2.93 3.95 4.79 5.62 5.94 6.08 6.03 6.03
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Canada 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 2.00 (60-68) 4.00 (44-54) 3.00 (44-51) 6.00 (39-50) 4.00 (40-55) 4.00 (45-54) 5.00 (45-54) 5.00 (45-54)
(ii) Top marginal income and payroll tax rate 4.00 (44-54) 3.00 (44-51) 6.00 (39-50) 4.00 (40-55) 4.00 (45-54) 5.00 (45-54) 5.00 (45-54)
F. Contracts 7.78 7.78 7.54 6.77 6.22 6.38 6.38 6.38
G. Real property 9.02 9.25 9.09 8.67 8.68 8.68 8.68
3. Sound Money 8.86 9.46 9.67 8.95 9.56 9.58 9.46 9.18
A. Money growth 8.31 (8.47) 8.82 (5.88) 9.88 (0.59) 7.52 (12.41) 9.02 (4.89) 9.28 (3.6) 8.54 (7.3) 8.54 (7.3)
C. Inflation 7.80 (11) 9.38 (3.11) 9.45 (2.75) 9.64 (1.78) 9.77 (1.13) 9.55 (2.27) 9.61 (1.95) 9.32 (3.4)
A. Tariffs 8.08 7.93 8.78 7.25 6.94 7.18 7.19 7.07
(ii) Mean tariff rate 7.76 (11.2) 8.12 (9.4) 9.22 (3.9) 9.26 (3.7) 9.16 (4.2) 9.22 (3.9) 9.22 (3.9) 9.20 (4)
5. Regulation 8.78 8.69 8.22 8.38 8.13 8.19 7.68 7.99
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Central African Republic 1980 1990 2000 2010 2015 2019 2020 2021
(i) Top marginal income tax rate 5.00 (39-48) 3.00 (50) 5.00 (40) 5.00 (40) 5.00 (40)
(ii) Top marginal income and payroll tax rate 2.00 (52) 2.00 (52)
F. Contracts 0.55 0.25 0.25 0.25 0.25 0.25
G. Real property 3.58 3.70 3.58 4.93 4.97 4.97 4.97
3. Sound Money 5.33 7.09 7.04 6.95 4.85 6.63 6.62 6.60
A. Money growth 7.46 (12.69) 9.97 (-0.14) 9.15 (-4.23) 8.69 (6.55) 8.59 (7.06) 8.19 (9.06) 8.19 (9.06) 8.19 (9.06)
C. Inflation 6.35 (18.27) 9.55 (2.27) 9.36 (3.2) 9.70 (1.49) 2.57 (37.14) 9.58 (2.1) 9.46 (2.69) 9.15 (4.26)
A. Tariffs 2.93 2.97 5.58 6.09 6.53 6.61 6.60 6.60
(ii) Mean tariff rate 3.60 (32) 6.28 (18.6) 6.44 (17.8) 6.40 (18) 6.40 (18) 6.40 (18) 6.40 (18)
5. Regulation 2.09 5.02 4.21 4.82 5.00 4.82 4.90 4.88
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Chad 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 4.12 (26) 8.66 (10.54) 9.44 (7.9) 8.46 (11.24) 9.84 (6.56) 10.00 (4.5) 10.00 (5.01) 10.00 (5.41)
C. Government investment 5.88 (29.43) 8.30 (20.96) 7.23 (24.7) 4.01 (35.98) 1.01 (46.46)
F. Contracts 2.83 1.40 2.36 2.36 2.36 2.36
G. Real property 4.17 4.17 4.17 4.96 6.79 6.79 6.79
3. Sound Money 6.60 5.68 6.66 6.28 6.37 6.76 6.99 6.97
A. Money growth 8.37 (8.17) 8.83 (-5.85) 9.75 (-1.23) 9.39 (3.06) 8.92 (5.42) 9.99 (-0.05) 9.99 (-0.05) 9.99 (-0.05)
C. Inflation 8.25 (8.73) 7.72 (11.41) 9.24 (3.82) 9.58 (-2.08) 9.27 (3.66) 9.20 (4) 9.81 (-0.97) 9.85 (-0.77)
A. Tariffs 7.40 6.24 6.31 6.31 6.31 6.31 6.31
(i) Trade tax revenue 7.40 (3.9)
5. Regulation 3.43 3.60 4.39 4.67 4.57 4.32 4.67 4.63
(vi) Conscription 10.00 0.00 3.00 3.00 3.00 3.00 3.00 3.00

Chile 1980 1990 2000 2010 2015 2019 2020 2021

D. Military interference 6.39 5.14 7.50 7.50 7.50 7.50 7.50
F. Contracts 6.24 7.09 7.09 6.29 6.29 6.08 6.08 6.08
G. Real property 8.95 8.95 8.99 9.07 9.10 9.10 9.10
3. Sound Money 2.31 7.55 9.11 9.31 9.39 9.69 9.40 9.27
A. Money growth 0.00 (60.92) 6.12 (19.4) 8.80 (6.01) 9.85 (0.77) 9.04 (4.78) 9.70 (1.49) 9.11 (4.45) 9.11 (4.45)
C. Inflation 4.25 (28.76) 5.75 (21.24) 9.23 (3.84) 9.72 (1.41) 9.13 (4.35) 9.51 (2.43) 9.49 (2.56) 9.10 (4.52)
A. Tariffs 8.71 8.18 8.91 9.47 9.47 9.48 9.49 9.49
(ii) Mean tariff rate 8.00 (10) 7.00 (15) 8.20 (9) 8.80 (6) 8.80 (6) 8.80 (6) 8.80 (6) 8.80 (6)
(iii) Standard deviation of tariff rates 10.00 (0) 10.00 (0) 10.00 (0) 9.83 (0.42) 9.83 (0.42) 9.83 (0.42) 9.83 (0.42) 9.83 (0.42)
5. Regulation 5.75 7.35 7.84 7.78 7.51 7.29 7.01 6.73
B. Labor market regulation 4.95 6.21 6.94 5.56 5.40 5.40 5.33
(iii) Flexible wage determination 7.93 8.85 7.57 8.46 8.30 8.30 8.30
(vi) Conscription 3.00 0.00 0.00 1.00 0.00 0.00 0.00 0.00

China 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.03 5.91 5.62 5.58 5.36 4.83 4.83 4.83
G. Real property 8.27 8.38 8.43 8.51 8.32 8.32 8.32
3. Sound Money 6.24 6.45 8.24 7.89 8.25 8.45 8.42 8.49
A. Money growth 8.07 (9.67) 9.37 (3.17) 8.61 (6.97) 9.54 (2.32) 9.90 (0.51) 9.81 (0.96) 9.81 (0.96)
C. Inflation 9.24 (3.78) 8.86 (5.68) 9.95 (0.26) 9.34 (3.31) 9.71 (1.44) 9.59 (2.07) 9.42 (2.9) 9.80 (0.98)
A. Tariffs 3.15 3.16 7.11 8.13 8.11 8.49 8.50 8.49
5. Regulation 2.06 2.21 4.67 5.23 5.67 5.75 5.69 5.62
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Colombia 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 8.00 (30) 4.00 (43.4) 3.00 (47) 2.00 (52) 7.00 (39) 7.00 (39) 7.00 (39)
F. Contracts 6.26 5.37 5.37 3.68 3.99 3.74 3.74 3.74
G. Real property 8.74 8.41 8.96 9.04 9.06 9.06 9.06
3. Sound Money 4.65 4.46 6.37 8.10 7.98 8.34 8.16 8.14
A. Money growth 5.79 (21.04) 8.52 (7.41) 8.56 (7.18) 8.77 (6.16) 9.53 (2.35) 9.06 (4.72) 9.06 (4.72)
C. Inflation 4.48 (27.61) 4.29 (28.55) 8.16 (9.22) 9.54 (2.28) 9.00 (5.01) 9.35 (3.24) 9.29 (3.53) 9.30 (3.5)
A. Tariffs 4.05 5.53 7.85 7.31 8.00 8.19 8.20 8.12
(i) Trade tax revenue 4.80 (7.8) 5.99 (6.01) 8.37 (2.44) 7.97 (3.04) 8.85 (1.73) 9.27 (1.09) 9.39 (0.91) 9.33 (1)
5. Regulation 6.23 4.91 6.42 6.97 7.33 6.86 6.55 6.54
(vi) Conscription 0.00 0.00 1.00 0.00 1.00 1.00 1.00 1.00

Comoros 1980 1990 2000 2010 2015 2019 2020 2021

Summary Ratings (Rank) 5.84 (137) 5.73 (137) 5.63 (139)
1. Size of Government 6.36 6.79 6.42
(ii) Top marginal income and payroll tax rate 7.00 (34) 7.00 (34)
E. State ownership of assets 4.39 7.64 6.17
2. Legal System and Property Rights 3.19 3.32 3.09
A. Judicial independence 4.24 4.24 5.08 4.23
E. Integrity of the legal system 3.80 3.80 5.00 3.51
F. Contracts 2.08 2.08 2.08 2.08 2.08 2.08
G. Real property 4.55 4.55 7.92 6.93 6.93 6.93
3. Sound Money 7.18 6.87 6.74
A. Money growth 0.92 (45.38) 8.35 (8.23) 8.81 (5.93) 9.46 (2.7) 9.28 (3.62) 9.28 (3.62)
B. Standard deviation of inflation 9.59 (1.02) 8.95 (2.63) 8.72 (3.19)
C. Inflation 9.66 (1.7) 9.26 (3.7) 8.97 (5.13)
A. Tariffs 6.88 3.42 6.80
(iii) Freedom of foreigners to visit 10.00 10.00 0.00
5. Regulation 4.57 4.18 4.66 6.07 6.14 6.10
A. Credit market regulation 8.41 8.91 8.91
B. Labor market regulation 3.33 3.75 5.30 5.30 5.30
(ii) Hiring and firing regulations 3.61 4.16 4.16 4.16 4.16
(i) Regulatory burden
(iii) Impartial public administration 5.07 4.42 3.99

Congo, Democratic Repubic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 0.00 0.38 0.49 0.49 0.49 0.49
G. Real property 5.67 4.64 5.70 5.39 5.96 5.96 5.96
3. Sound Money 0.83 0.00 1.43 7.37 7.84 4.65 6.00 6.03
A. Money growth 3.32 (33.39) 0.00 (85.32) 0.72 (46.38) 3.49 (32.56) 8.73 (6.36) 7.26 (13.71) 7.26 (13.71) 7.26 (13.71)
C. Inflation 0.00 (51.4) 0.00 (108.95) 0.00 (550.01) 8.58 (7.1) 9.85 (0.74) 4.14 (29.3) 9.06 (4.71) 8.20 (8.99)
A. Tariffs 4.21 4.90 8.70 7.74 7.89 8.10 8.16 8.10
(ii) Mean tariff rate 5.28 (23.6) 5.86 (20.7) 7.80 (11) 7.82 (10.9) 7.82 (10.9) 7.80 (11) 7.82 (10.9)
5. Regulation 2.46 1.73 3.80 4.46 5.51 4.93 4.93 5.02
(iii) Flexible wage determination 6.96 6.33 6.33 6.33
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Congo, Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.07 2.76 2.76 2.76 2.76 2.76
G. Real property 2.41 3.05 4.42 4.92 4.51 4.51 4.51
3. Sound Money 5.40 5.95 4.42 4.69 5.80 5.22 5.64 5.31
A. Money growth 8.59 (7.06) 9.76 (1.19) 7.73 (11.36) 7.55 (12.24) 9.99 (0.07) 8.52 (-7.41) 8.52 (-7.41) 8.52 (-7.41)
C. Inflation 5.97 (20.14) 9.85 (-0.77) 9.83 (-0.84) 9.00 (5) 9.10 (4.51) 9.76 (1.2) 9.56 (2.21) 9.66 (1.72)
A. Tariffs 7.47 4.53 7.43 7.35 7.42 7.97 7.82 7.82
5. Regulation 2.23 3.80 3.77 5.23 5.01 4.23 4.53 4.53
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
(i) Regulatory burden 0.00 3.25 3.25

Costa Rica 1980 1990 2000 2010 2015 2019 2020 2021
B. Transfers and subsidies 8.50 (6) 8.77 (5) 8.59 (5.66) 9.42 (2.63) 8.50 (6) 8.47 (6.12) 8.14 (7.34) 8.14 (7.34)
F. Contracts 4.41 4.26 4.26 4.26 4.26 4.26
G. Real property 8.42 8.42 8.49 8.52 8.67 8.67 8.67
3. Sound Money 7.79 7.91 8.89 8.00 9.70 9.78 9.68 9.70
A. Money growth 6.71 (16.43) 6.67 (16.64) 9.23 (-3.85) 8.77 (6.17) 9.17 (4.14) 9.79 (-1.07) 9.49 (2.54) 9.49 (2.54)
C. Inflation 6.23 (18.83) 6.29 (18.57) 7.80 (10.99) 8.87 (5.66) 9.84 (0.8) 9.56 (2.22) 9.58 (2.1) 9.65 (1.73)
A. Tariffs 3.23 5.63 8.40 8.15 7.91 8.02 8.07 8.07
(i) Trade tax revenue 6.47 (5.3) 5.33 (7) 9.28 (1.08) 9.17 (1.25) 8.61 (2.08) 8.71 (1.93) 8.92 (1.61) 8.97 (1.54)
(ii) Mean tariff rate 0.00 (55) 6.72 (16.4) 8.92 (5.4) 8.92 (5.4) 8.88 (5.6) 8.88 (5.6) 8.88 (5.6) 8.88 (5.6)
5. Regulation 8.29 8.75 6.84 6.56 6.63 6.53 6.40 6.73
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Côte d’Ivoire 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 4.31 3.73 4.49 4.49 4.49 4.49
G. Real property 0.43 0.30 4.26 6.93 6.93 6.93 6.93
3. Sound Money 5.02 6.96 6.72 6.38 7.00 7.20 7.13 6.94
A. Money growth 8.72 (6.38) 9.40 (-2.98) 9.90 (-0.48) 7.11 (14.46) 8.92 (5.42) 9.44 (2.78) 9.21 (3.97) 9.21 (3.97)
C. Inflation 5.17 (24.14) 9.10 (-4.52) 9.51 (2.46) 9.66 (1.68) 9.75 (1.24) 9.91 (0.44) 9.78 (-1.11) 9.18 (4.09)
A. Tariffs 2.98 3.07 5.77 6.60 6.74 6.64 6.65 6.62
(ii) Mean tariff rate 4.50 (27.5) 3.40 (33) 7.60 (12) 7.62 (11.9) 7.56 (12.2) 7.58 (12.1) 7.58 (12.1) 7.58 (12.1)
5. Regulation 6.34 6.37 5.64 5.55 6.09 6.50 6.43 6.41
(vi) Conscription 10.00 5.00 5.00 1.00 3.00 3.00 3.00 3.00

Croatia 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 2.45 (31.66) 4.32 (25.3) 4.22 (25.65) 3.95 (26.57) 3.24 (28.97) 3.56 (27.9)
(i) Top marginal income tax rate 4.00 (35-53) 3.00 (44-51) 4.00 (40-48) 5.00 (36-42) 5.00 (36-42) 7.00 (36-42)
(ii) Top marginal income and payroll tax rate 0.00 (55.9-68) 0.00 (62-67) 0.00 (59-64) 1.00 (56-60) 1.00 (56-60) 2.00 (56-60)
F. Contracts 4.61 3.95 3.82 3.57 3.57 3.78
G. Real property 3.36 3.36 6.39 7.18 8.39 8.39 8.39
3. Sound Money 2.50 7.62 8.29 9.81 9.68 9.60 9.52
A. Money growth 7.26 (13.7) 9.13 (4.35) 9.74 (-1.29) 9.37 (3.14) 8.93 (5.33) 8.93 (5.33)
B. Standard deviation of inflation 9.15 (2.11) 9.23 (1.92) 9.59 (1.02) 9.66 (0.84) 9.64 (0.9) 9.66 (0.85)
C. Inflation 0.00 (500) 9.07 (4.63) 9.79 (1.05) 9.91 (-0.46) 9.70 (1.5) 9.85 (0.77) 9.49 (2.55)
D. Foreign currency bank accounts 5.00 5.00 5.00 10.00 10.00 10.00 10.00
A. Tariffs 8.47 8.73 8.36 8.20 8.03 8.06
C. Black-market exchange rates 0.00 10.00 10.00 10.00 10.00 10.00 10.00
(ii) Capital controls 0.00 0.00 4.62 4.62 4.62 4.62 3.85
5. Regulation 6.28 6.58 6.99 7.00 6.73 6.83
(vi) Conscription 3.00 10.00 10.00 10.00 10.00 10.00

Cyprus 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.50 4.50 4.50 4.50 4.50 4.50
G. Real property 6.07 6.07 6.41 7.30 7.30 7.30
3. Sound Money 5.45 7.03 6.88 9.44 9.69 9.28 9.12 9.00
A. Money growth 9.45 (2.75) 8.65 (6.77) 9.03 (4.84) 9.75 (1.26) 7.93 (10.37) 7.06 (14.71) 7.06 (14.71)
C. Inflation 7.30 (13.5) 8.95 (5.27) 9.17 (4.14) 9.52 (2.38) 9.58 (-2.1) 9.71 (1.44) 9.95 (0.25) 9.51 (2.45)
A. Tariffs 6.96 5.47 7.99 8.34 8.36 8.20 8.03 8.06
5. Regulation 6.76 7.63 6.73 6.88 7.23 7.48 6.84 7.29
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 1.00 1.00 1.00

Czechia 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 9.96 (15.13) 8.85 (19.04) 8.74 (19.41) 9.57 (16.49) 9.06 (18.3) 9.14 (18)
F. Contracts 7.12 7.12 6.66 4.95 4.62 4.52 4.52 4.52
G. Real property 6.69 6.69 8.56 8.16 8.17 8.17 8.17
3. Sound Money 8.00 9.58 9.69 9.57 9.44 9.42
A. Money growth 9.36 (3.21) 9.34 (3.32) 9.30 (3.51) 9.20 (3.99) 8.91 (5.46) 8.91 (5.46)
C. Inflation 9.22 (3.9) 9.72 (1.41) 9.93 (0.34) 9.57 (2.15) 9.43 (2.85) 9.23 (3.84)
D. Foreign currency bank accounts 5.00 10.00 10.00 10.00 10.00 10.00
A. Tariffs 8.22 8.34 8.36 8.20 8.03 8.06
C. Black-market exchange rates 10.00 10.00 10.00 10.00 10.00 10.00
5. Regulation 1.78 3.52 6.44 7.52 7.67 7.66 7.29 7.37
(vi) Conscription 0.00 0.00 3.00 10.00 10.00 10.00 10.00 10.00

Denmark 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 0.00 (68.8) 1.00 (62.7) 2.00 (56) 2.00 (56) 2.00 (56) 2.00 (56) 2.00 (56)
F. Contracts 10.00 9.38 9.09 7.98 7.90 7.71 7.71 7.71
G. Real property 9.01 9.01 9.01 9.73 9.73 9.73 9.73
3. Sound Money 6.72 9.65 9.70 9.40 9.75 9.90 9.68 9.63
A. Money growth 8.84 (5.79) 9.57 (2.16) 9.71 (-1.46) 8.72 (6.4) 9.35 (3.26) 9.98 (-0.09) 9.26 (3.69) 9.26 (3.69)
C. Inflation 8.35 (8.23) 9.32 (3.4) 9.42 (2.92) 9.54 (2.3) 9.91 (0.45) 9.84 (0.81) 9.85 (0.76) 9.63 (1.85)
A. Tariffs 8.95 8.48 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.60 7.98 8.29 8.44 8.45 8.48 8.36 8.39
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Djibouti 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 0.00 (96.09) 0.00 (88.66) 0.00 (79.4) 3.90 (36.35) 5.39 (31.13) 7.14 (25) 7.14 (25)
B. Impartial courts 2.73 2.73 2.66 2.47
F. Contracts 1.47 1.47 1.47 1.47 1.58 1.58
G. Real property 4.91 4.91 5.09 7.71 7.71 7.71
3. Sound Money 7.36 7.18 7.26
A. Money growth 0.00 (54.38) 0.00 (54.38) 0.00 (54.38) 0.00 (54.38) 0.00 (54.38) 0.00 (54.38)
C. Inflation 9.97 (0.15) 9.34 (3.32) 9.70 (1.48)
A. Tariffs 6.24 6.24 6.24
5. Regulation 4.64 4.71 6.00 6.47 6.83 6.83
(ii) Private sector credit 9.61 9.61

Dominican Republic 1980 1990 2000 2010 2015 2019 2020 2021
A. Government consumption 9.12 (8.98) 10.00 (6) 9.03 (9.29) 8.35 (11.6) 8.04 (12.67) 7.64 (14.03) 7.25 (15.34) 7.44 (14.72)
F. Contracts 3.23 3.51 3.34 3.02 3.02 3.02
G. Real property 5.91 6.30 7.65 8.00 8.26 8.26 8.26
3. Sound Money 7.43 2.24 6.47 9.19 9.54 9.55 9.46 9.10
A. Money growth 9.33 (3.35) 5.47 (22.67) 8.00 (10.01) 9.07 (4.67) 9.33 (3.37) 9.51 (2.45) 8.82 (5.88) 8.82 (5.88)
C. Inflation 7.26 (13.7) 0.00 (51.05) 8.46 (7.72) 8.73 (6.33) 9.83 (0.84) 9.29 (3.56) 9.64 (1.81) 8.35 (8.24)
A. Tariffs 3.47 5.11 5.78 7.86 7.91 7.76 7.78 7.79
(iii) Standard deviation of tariff rates 6.00 (10) 6.45 (8.88) 6.44 (8.91) 5.96 (10.11) 5.96 (10.11) 5.99 (10.03)
5. Regulation 5.90 4.72 6.56 6.20 6.25 6.01 5.99 6.00
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Ecuador 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 8.80 (4.9) 9.51 (2.3) 9.86 (1.02) 9.59 (2) 9.59 (2) 9.59 (2) 9.59 (2) 9.59 (2)
F. Contracts 5.24 4.72 4.45 3.54 3.54 3.71 3.71 3.71
G. Real property 7.05 7.40 9.01 8.59 8.82 8.82 8.82
3. Sound Money 8.23 5.78 5.41 6.58 8.04 8.51 8.57 8.56
A. Money growth 8.46 (7.7) 9.84 (-0.82) 6.28 (18.62) 8.27 (8.67) 9.12 (4.41) 9.82 (-0.89) 9.86 (-0.7) 9.86 (-0.7)
C. Inflation 6.10 (19.51) 0.00 (54.01) 0.00 (96.09) 9.29 (3.56) 9.21 (3.97) 9.96 (-0.22) 9.95 (0.27) 9.97 (0.13)
A. Tariffs 5.20 3.30 7.14 6.37 6.31 6.34 6.34 6.35
(iii) Standard deviation of tariff rates 0.00 (27) 7.48 (6.3) 4.80 (12.99) 4.76 (13.09) 4.93 (12.67) 4.93 (12.67) 4.76 (13.1)
5. Regulation 4.86 5.15 4.50 6.11 6.10 5.89 5.90 5.96
(vi) Conscription 0.00 3.00 3.00 3.00 10.00 10.00 10.00 10.00

Egypt, Arab Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 4.81 4.59 4.59 3.64 3.05 3.05 3.05 3.05
G. Real property 4.12 4.35 8.34 8.70 8.20 8.20 8.20
3. Sound Money 7.56 7.81 9.49 8.96 7.64 7.90 8.02 8.42
A. Money growth 5.72 (21.39) 7.55 (12.25) 9.31 (3.44) 8.90 (5.52) 8.15 (9.26) 7.31 (13.44) 8.05 (9.75) 8.05 (9.75)
C. Inflation 6.39 (18.03) 6.31 (18.44) 9.46 (2.68) 7.75 (11.27) 7.93 (10.36) 7.12 (14.4) 7.23 (13.88) 8.96 (5.21)
A. Tariffs 0.89 3.12 3.74 4.96 4.97 4.83 4.83 4.83
(ii) Mean tariff rate 0.52 (47.4) 3.30 (33.5) 5.90 (20.5) 6.60 (17) 6.64 (16.8) 6.20 (19) 6.20 (19) 6.20 (19)
5. Regulation 3.77 5.01 4.54 4.62 4.55 4.74 4.63 4.73
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

El Salvador 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.32 4.42 4.42 4.14 4.14 3.85
G. Real property 7.83 7.83 8.17 8.17 8.17 8.17 8.17
3. Sound Money 5.71 5.56 9.58 9.57 9.70 9.67 9.60 9.27
A. Money growth 8.84 (5.8) 9.72 (1.39) 9.67 (1.65) 9.65 (1.74) 9.86 (0.71) 9.14 (4.3) 8.69 (6.53) 8.69 (6.53)
C. Inflation 6.61 (16.95) 5.51 (22.47) 9.55 (2.27) 9.76 (1.18) 9.85 (-0.73) 9.78 (1.09) 9.98 (0.08) 9.31 (3.47)
A. Tariffs 3.13 6.52 8.02 8.17 8.24 8.23 8.24 8.26
(ii) Mean tariff rate 0.40 (48) 5.78 (21.1) 8.52 (7.4) 8.82 (5.9) 8.80 (6) 8.80 (6) 8.80 (6) 8.80 (6)
5. Regulation 5.59 5.26 6.83 6.77 6.47 6.26 5.94 5.80
(vi) Conscription 3.00 0.00 10.00 10.00 3.00 3.00 3.00 3.00

Estonia 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 5.74 (20.48) 3.73 (27.33) 3.50 (28.09) 3.51 (28.06) 3.29 (28.83) 3.10 (29.45) 3.19 (29.15)
F. Contracts 8.10 6.58 6.72 6.74 6.74 6.74
G. Real property 8.81 8.61 9.50 9.50 9.50 9.50 9.50
3. Sound Money 4.48 8.67 9.43 9.49 9.30 9.07 8.91
A. Money growth 8.32 (8.39) 9.98 (-0.1) 8.51 (7.47) 8.50 (7.51) 7.52 (12.39) 7.52 (12.39)
C. Inflation 3.27 (33.65) 9.19 (4.03) 9.41 (2.97) 9.91 (-0.46) 9.31 (3.44) 9.54 (2.28) 9.07 (4.65)
A. Tariffs 9.77 9.99 8.34 8.90 8.20 8.03 8.06
5. Regulation 3.39 7.64 8.14 8.34 8.25 8.24 8.18
(vi) Conscription 0.00 3.00 3.00 3.00 3.00 3.00 3.00

Eswatini 1980 1990 2000 2010 2015 2019 2020 2021

C. Property rights 2.81 2.93 3.00 3.00 3.00
F. Contracts 1.80 1.80 0.80 0.80 0.80 0.80
G. Real property 6.80 6.80 7.27 7.27 7.20 7.20
3. Sound Money 7.86 8.06 7.74 7.91 7.78
A. Money growth 0.00 (60.38) 8.98 (5.08) 9.05 (4.73) 8.93 (5.33) 9.25 (3.73) 9.25 (3.73)
C. Inflation 9.86 (0.7) 9.01 (4.95) 9.04 (4.81) 9.48 (2.6) 9.26 (3.72)
A. Tariffs 6.15 4.64 5.56 4.77 5.82
(i) Trade tax revenue 4.91 (7.63) 0.00 (15.96) 2.67 (10.99) 0.25 (14.63) 3.33 (10)
5. Regulation 3.28 6.16 6.16 5.46 5.45 5.52
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Ethiopia 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 0.00 (51.48) 1.89 (43.38) 0.00 (64.84) 2.01 (42.97) 5.14 (32) 5.96 (29.15) 6.12 (28.57)
F. Contracts 5.70 4.93 5.27 5.27 5.27 5.27
G. Real property 5.52 8.50 7.01 7.04 7.04 7.04
3. Sound Money 5.55 5.30 6.05 5.77 6.32
A. Money growth 0.00 (61.38) 8.02 (9.88) 8.02 (9.88) 8.02 (9.88) 8.02 (9.88) 8.02 (9.88)
C. Inflation 8.37 (8.14) 7.97 (10.13) 7.24 (13.8) 6.83 (15.84) 4.63 (26.84)
A. Tariffs 5.11 6.11 6.15 5.81 5.81
(ii) Mean tariff rate 6.54 (17.3) 6.52 (17.4) 6.52 (17.4) 6.52 (17.4) 6.60 (17)
5. Regulation 4.93 5.82 5.79 6.12 6.13 6.05
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Fiji 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 5.56 (21.09) 5.90 (19.93) 5.88 (20) 6.34 (18.45) 4.30 (25.39) 4.15 (25.89) 3.54 (27.98) 4.90 (23.34)
F. Contracts 4.52 5.05 5.05 4.94 4.94 4.94
G. Real property 7.96 5.15 8.06 7.71 7.71 7.71 7.71
3. Sound Money 5.70 6.42 6.94 6.79 6.66 7.02 7.00 7.11
A. Money growth 8.54 (7.3) 7.93 (10.36) 9.57 (-2.16) 9.63 (1.83) 8.26 (8.68) 9.81 (0.95) 9.57 (2.17) 9.57 (2.17)
C. Inflation 6.54 (17.31) 8.58 (7.1) 9.78 (1.09) 8.89 (5.54) 9.73 (1.37) 9.18 (4.08) 9.65 (1.77) 9.97 (0.16)
A. Tariffs 6.13 5.73 7.27 5.12 4.87 4.90 4.43 4.66
(iv) Protection of foreign assets 4.64 5.00 5.00 5.00
5. Regulation 7.10 5.57 6.60 7.43 7.88 7.41 7.65 7.74
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Finland 1980 1990 2000 2010 2015 2019 2020 2021

(53.5-
(ii) Top marginal income and payroll tax rate 1.00 (61-69) 1.00
60.5)
3.00 (52-57) 2.00 (54-60) 2.00 (54-59) 2.00 (54-59) 2.00 (54-59)
F. Contracts 8.62 8.62 8.62 8.25 7.80 7.53 7.53 7.53
G. Real property 8.42 8.42 8.39 8.08 7.52 7.52 7.52
3. Sound Money 7.78 9.27 9.55 9.62 9.60 9.38 9.17 9.10
A. Money growth 8.82 (5.92) 8.62 (6.91) 9.48 (2.58) 9.11 (4.45) 8.74 (6.3) 7.96 (10.19) 7.10 (14.5) 7.10 (14.5)
B. Standard deviation of inflation 9.27 (1.82) 9.63 (0.92) 9.38 (1.54) 9.60 (1) 9.72 (0.71) 9.79 (0.53) 9.79 (0.53) 9.74 (0.65)
C. Inflation 8.05 (9.75) 8.84 (5.82) 9.33 (3.37) 9.76 (1.22) 9.96 (-0.21) 9.78 (1.08) 9.80 (1.02) 9.56 (2.19)
A. Tariffs 8.69 8.01 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.45 7.54 8.31 8.34 8.35 8.32 8.12 8.18
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

France 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 1.00 (61) 0.00 (62-65) 4.00 (54-56) 2.00 (60-62) 2.00 (61-62) 2.00 (61-62) 2.00 (61-62)
F. Contracts 7.65 7.65 7.65 6.64 6.48 6.26 6.26 6.26
G. Real property 4.60 4.40 6.14 6.39 6.81 6.81 6.81
3. Sound Money 6.40 9.69 9.59 9.67 9.77 9.38 9.12 9.11
A. Money growth 8.19 (9.06) 9.72 (1.38) 8.84 (5.82) 9.35 (3.23) 9.25 (3.77) 8.00 (10) 7.05 (14.74) 7.05 (14.74)
C. Inflation 7.72 (11.38) 9.38 (3.09) 9.66 (1.69) 9.69 (1.53) 9.99 (0.04) 9.63 (1.85) 9.78 (1.11) 9.67 (1.64)
A. Tariffs 8.95 8.46 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.39 7.39 7.83 7.42 7.44 7.43 7.15 7.28
(vi) Conscription 3.00 3.00 10.00 10.00 10.00 10.00 10.00 10.00

Gabon 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 2.00 (52-57) 2.00 (54) 2.00 (53) 2.00 (53) 2.00 (53)
F. Contracts 1.46 1.46 1.46 1.46 1.46 1.46
G. Real property 5.41 5.81 4.60 4.86 4.86 4.86
3. Sound Money 4.33 5.42 5.73 5.65 6.53 6.51 6.65 6.10
A. Money growth 9.24 (-3.81) 9.57 (-2.17) 9.43 (2.86) 8.81 (5.96) 9.98 (-0.08) 9.64 (-1.82) 9.64 (-1.82) 9.64 (-1.82)
B. Standard deviation of inflation 5.43 (11.42) 5.17 (12.08) 3.60 (16) 4.09 (14.78) 6.21 (9.48) 7.35 (6.62) 7.44 (6.39) 4.99 (12.52)
C. Inflation 2.64 (36.78) 6.93 (15.36) 9.90 (0.5) 9.71 (1.46) 9.94 (-0.3) 9.04 (4.79) 9.51 (2.46) 9.78 (1.09)
A. Tariffs 3.24 6.80 6.00 6.30 6.27 6.66 6.66 6.66
(i) Trade tax revenue 5.13 (7.3) 6.80 (4.8) 6.24 (5.64) 7.33 (4) 7.33 (4) 7.33 (4)
5. Regulation 3.76 6.25 4.80 5.90 5.66 5.41 5.46 5.37
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Gambia, The 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.70 3.70 3.80 3.13 3.13 3.13
G. Real property 3.49 3.49 6.25 6.06 6.06 6.06
3. Sound Money 8.11 9.35 9.23 9.23 9.19
A. Money growth 0.00 (66.38) 9.66 (-1.7) 9.55 (2.27) 8.70 (6.5) 8.70 (6.5) 8.70 (6.5)
C. Inflation 8.99 (5.05) 8.64 (6.81) 8.70 (6.52) 8.58 (7.12) 8.53 (7.37)
A. Tariffs 6.47 6.48 7.16 7.16 7.16
(ii) Mean tariff rate 7.20 (14) 7.18 (14.1) 7.58 (12.1) 7.58 (12.1) 7.58 (12.1)
5. Regulation 8.47 4.95 6.87 6.24 6.48 7.06 7.05
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Georgia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.36 5.75 5.75 5.90 5.90 5.90
G. Real property 8.44 9.63 9.94 9.98 9.98 9.98 9.98
3. Sound Money 8.57 8.94 9.34 9.08 8.74
A. Money growth 4.78 (26.08) 7.71 (11.46) 8.10 (9.52) 8.20 (9.01) 7.78 (11.09) 7.78 (11.09)
C. Inflation 8.58 (7.1) 9.20 (4) 9.48 (2.62) 9.03 (4.85) 8.09 (9.57)
A. Tariffs 9.23 9.16 9.31 9.45 9.44 9.47
5. Regulation 7.09 7.92 8.19 7.95 7.41 7.40
(vi) Conscription 1.00 1.00 3.00 3.00 3.00

Germany 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 4.03 (26.3) 4.35 (25.2) 4.55 (24.52) 4.24 (25.57) 3.82 (27) 3.51 (28.05) 2.83 (30.39) 2.64 (31.01)
F. Contracts 8.57 8.83 9.09 8.29 8.03 8.03 8.03 8.03
G. Real property 7.80 7.88 7.53 6.81 6.85 6.85 6.85
3. Sound Money 9.51 9.67 9.55 9.59 9.65 9.40 9.19 9.07
A. Money growth 9.68 (1.6) 8.77 (6.13) 8.86 (5.69) 8.85 (5.75) 8.07 (9.64) 7.17 (14.16) 7.17 (14.16)
C. Inflation 8.90 (5.5) 9.46 (2.7) 9.71 (1.47) 9.77 (1.14) 9.95 (0.23) 9.65 (1.73) 9.71 (1.45) 9.37 (3.14)
A. Tariffs 8.95 8.44 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 6.94 7.01 7.27 7.37 8.10 7.86 7.55 7.73
(vi) Conscription 1.00 1.00 3.00 5.00 10.00 10.00 10.00 10.00

Ghana 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.29 3.95 3.11 3.11 3.11 3.11
G. Real property 5.95 3.78 9.00 8.74 7.37 7.37 7.37
3. Sound Money 1.63 4.52 5.30 7.04 5.66 6.15 6.20 6.29
A. Money growth 3.34 (33.31) 4.21 (28.97) 5.40 (23.01) 5.79 (21.05) 6.95 (15.24) 8.27 (8.67) 7.77 (11.13) 7.77 (11.13)
C. Inflation 0.00 (51.13) 5.87 (20.66) 4.96 (25.19) 7.86 (10.71) 6.57 (17.15) 8.03 (9.84) 8.56 (7.18) 8.01 (9.97)
A. Tariffs 0.00 4.38 6.54 7.15 7.29 7.77 7.31 7.31
(ii) Mean tariff rate 6.50 (17.5) 6.96 (15.2) 7.40 (13) 7.42 (12.9) 7.58 (12.1) 7.58 (12.1) 7.58 (12.1)
5. Regulation 2.41 3.47 4.92 6.03 6.24 6.40 6.14 6.11
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Greece 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.93 6.35 6.35 4.63 3.88 3.71 3.71 3.71
G. Real property 4.98 5.06 8.27 8.04 7.93 7.93 7.93
3. Sound Money 7.12 6.89 9.32 9.67 8.35 9.28 9.11 9.06
A. Money growth 7.94 (10.3) 7.05 (14.74) 8.70 (6.52) 9.99 (-0.07) 9.30 (3.51) 7.57 (12.15) 6.78 (16.11) 6.78 (16.11)
C. Inflation 6.46 (17.69) 6.47 (17.67) 9.37 (3.17) 9.06 (4.71) 9.65 (-1.74) 9.87 (0.63) 9.95 (0.25) 9.76 (1.22)
A. Tariffs 8.05 8.41 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 4.72 5.46 6.27 6.00 6.72 6.78 5.90 6.32
(vi) Conscription 0.00 0.00 0.00 3.00 3.00 3.00 3.00 3.00

Guatemala 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 2.06 1.69 1.69 1.69 1.69 1.69
G. Real property 7.61 7.15 9.16 8.33 8.36 8.36 8.36
3. Sound Money 8.90 6.94 7.73 9.33 9.58 9.62 9.47 9.44
A. Money growth 9.04 (4.82) 7.56 (12.2) 7.83 (10.87) 9.00 (5) 9.21 (3.93) 9.36 (3.2) 8.80 (5.99) 8.80 (5.99)
C. Inflation 8.00 (10) 6.24 (18.78) 8.80 (5.98) 9.23 (3.86) 9.52 (2.39) 9.25 (3.75) 9.26 (3.7) 9.15 (4.26)
A. Tariffs 3.40 4.33 7.93 8.54 8.58 8.55 8.57 8.54
(ii) Mean tariff rate 0.00 (50) 5.40 (23) 8.56 (7.2) 8.88 (5.6) 8.88 (5.6) 8.88 (5.6) 8.88 (5.6) 8.88 (5.6)
5. Regulation 4.45 5.43 6.11 6.42 6.71 6.75 6.64 6.70
(vi) Conscription 10.00 0.00 3.00 3.00 3.00 10.00 10.00 10.00

Guinea 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.24 2.83 2.69 2.69 2.69 2.69
G. Real property 3.03 3.47 6.37 7.59 7.59 7.59
3. Sound Money 7.58 7.28 7.17 7.00
A. Money growth 8.38 (8.08) 6.11 (19.44) 9.19 (4.05) 8.32 (8.42) 8.00 (10.02) 8.00 (10.02)
C. Inflation 8.37 (8.15) 8.03 (9.83) 8.11 (9.47) 7.48 (12.6)
A. Tariffs 8.05 7.96 7.96 7.96
5. Regulation 5.40 3.88 6.36 6.03 6.01 5.89
(vi) Conscription 0.00 3.00 3.00 3.00

Guinea-Bissau 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 1.74 1.74 1.74 1.65 1.65 1.65
G. Real property 4.24 3.51 7.23 7.32 7.32 7.32
3. Sound Money 5.43 0.88 3.86 6.19 6.30 6.72 6.96 6.87
A. Money growth 0.00 (107.91) 4.06 (29.69) 7.09 (14.54) 7.68 (11.61) 9.79 (1.03) 9.64 (1.8) 9.64 (1.8)
C. Inflation 7.67 (11.63) 3.54 (32.31) 8.27 (8.64) 9.50 (2.52) 9.72 (1.4) 9.72 (1.4) 9.95 (0.25) 9.55 (2.24)
A. Tariffs 7.60 7.45 7.45 7.09 7.09 7.09
5. Regulation 4.03 3.71 4.70 4.81 4.82 5.04 4.96
(i) Ownership of banks 2.00 10.00 8.00 10.00 10.00 10.00
(vi) Conscription 0.00 0.00 0.00 0.00 3.00 3.00 3.00

Guyana 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.76 3.53 3.53 3.47 3.47 3.47
G. Real property 8.72 7.88 7.07 7.62 7.62 7.62
3. Sound Money 5.66 2.32 7.89 7.95 8.24 8.34 7.27 6.73
A. Money growth 7.91 (10.43) 2.39 (38.07) 9.32 (3.4) 8.41 (7.97) 9.78 (1.12) 9.75 (1.25) 9.93 (-0.34) 9.93 (-0.34)
C. Inflation 7.64 (11.78) 6.90 (15.51) 8.77 (6.15) 9.58 (2.09) 9.81 (-0.96) 9.74 (1.28) 9.58 (2.09) 8.99 (5.03)
A. Tariffs 8.80 6.60 6.47 6.47 6.23 6.23 6.28
(i) Trade tax revenue 8.80 (1.8)
5. Regulation 4.00 5.33 6.60 6.77 6.51 6.05 6.31 5.83
(iii) Flexible wage determination 6.79 6.86
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Haiti 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 8.54 (10.96) 9.54 (7.58) 5.10 (22.65) 9.95 (6.16) 9.59 (7.38) 9.73 (6.93) 9.71 (7) 9.67 (7.11)
F. Contracts 3.09 2.02 1.94 1.94 1.94 1.94
G. Real property 2.76 2.34 2.90 2.70 2.76 2.76 2.76
3. Sound Money 7.58 8.35 8.14 8.29 7.79 7.26 7.07 7.16
A. Money growth 7.93 (10.34) 8.50 (7.5) 6.93 (15.37) 7.54 (12.32) 8.57 (7.13) 8.00 (9.98) 8.41 (7.93) 8.41 (7.93)
C. Inflation 5.72 (21.39) 7.92 (10.41) 7.26 (13.71) 8.86 (5.7) 8.20 (9.02) 7.50 (12.48) 6.26 (18.7) 6.63 (16.84)
A. Tariffs 3.93 5.53 8.00 8.40 8.36 7.01 8.22 8.22
(i) Trade tax revenue 3.40 (9.9) 5.53 (6.7)
5. Regulation 5.13 3.39 6.14 5.51 6.11 6.31 6.23 6.02
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Honduras 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 9.54 (2.2) 9.05 (4) 10.00 (0.3) 10.00 (0.45) 10.00 (0.17) 9.36 (2.85) 9.36 (2.85)
F. Contracts 2.17 1.43 1.43 1.32 1.32 1.32
G. Real property 6.76 7.41 7.76 7.71 7.59 7.59 7.59
3. Sound Money 8.70 8.49 7.86 9.40 9.33 9.31 9.27 9.26
A. Money growth 8.66 (6.72) 7.69 (11.57) 6.23 (18.84) 9.39 (3.05) 9.11 (4.44) 8.76 (6.22) 8.39 (8.03) 8.39 (8.03)
C. Inflation 7.35 (13.27) 8.95 (5.25) 7.79 (11.06) 9.06 (4.7) 9.37 (3.16) 9.13 (4.35) 9.13 (4.37) 9.10 (4.48)
A. Tariffs 3.67 6.00 7.83 8.44 8.41 8.46 8.37 8.35
5. Regulation 5.33 6.10 6.22 6.62 6.77 6.46 6.32 6.31
(vi) Conscription 10.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00

Hong Kong SAR, China 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 9.05 8.58 8.23 8.06 8.06 8.06
G. Real property 7.34 6.79 7.51 6.95 6.95 6.95 6.95
3. Sound Money 8.33 9.24 9.07 9.65 9.55 9.63 9.52 9.57
A. Money growth 9.29 (3.57) 9.58 (2.1) 9.15 (4.27) 9.33 (3.36) 9.12 (4.38) 9.12 (4.38)
C. Inflation 7.01 (14.96) 8.86 (5.71) 9.25 (-3.76) 9.53 (2.34) 9.40 (3) 9.52 (2.41) 9.43 (2.86) 9.69 (1.57)
A. Tariffs 9.83 9.91 9.93 10.00 10.00 10.00 10.00 10.00
(i) Trade tax revenue 9.67 (0.5) 9.73 (0.4) 9.80 (0.3) 9.99 (0.02) 9.99 (0.01) 10.00 (0) 10.00 (0) 10.00 (0)
(ii) Mean tariff rate 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
(iii) Standard deviation of tariff rates 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
5. Regulation 9.36 9.33 9.17 9.39 9.36 9.26 8.89 8.64
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Hungary 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 10.00 (14) 9.12 (18.07) 5.96 (29.15) 7.92 (22.27) 7.44 (23.96) 7.71 (23)
F. Contracts 5.47 5.70 4.99 4.73 4.53 3.91 3.91 3.91
G. Real property 4.91 4.91 6.06 8.03 8.03 8.03 8.03
3. Sound Money 5.89 5.91 7.23 9.45 9.84 9.46 9.26 9.25
A. Money growth 7.97 (10.17) 7.91 (10.45) 9.19 (4.03) 9.65 (1.76) 9.09 (4.53) 8.44 (7.82) 8.44 (7.82)
C. Inflation 8.79 (6.03) 8.82 (5.91) 8.04 (9.8) 9.02 (4.88) 9.99 (-0.07) 9.43 (2.85) 9.33 (3.34) 8.98 (5.11)
A. Tariffs 6.67 6.09 7.31 8.34 8.36 8.20 8.03 8.06
5. Regulation 4.94 6.01 6.99 7.66 7.22 7.04 6.63 6.63
(vi) Conscription 0.00 1.00 5.00 10.00 10.00 10.00 10.00 10.00

Iceland 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 8.10 7.22 7.14 7.14 7.14 7.14
G. Real property 9.14 9.14 8.75 8.75 8.75 8.75
3. Sound Money 2.44 7.00 9.25 6.77 7.19 9.64 9.55 9.42
A. Money growth 2.82 (35.88) 5.43 (22.85) 8.43 (7.84) 9.15 (4.27) 9.68 (1.61) 9.93 (-0.34) 9.39 (3.07) 9.39 (3.07)
C. Inflation 0.00 (52.48) 3.74 (31.3) 8.97 (5.16) 8.92 (5.4) 9.67 (1.63) 9.46 (2.68) 9.40 (3.01) 9.11 (4.44)
A. Tariffs 6.87 7.86 8.02 6.51 7.28 7.80 7.85 7.93
5. Regulation 6.35 6.83 7.82 7.19 8.13 7.70 7.24 7.12
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

India 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 8.34 (11.65) 7.15 (15.68) 6.74 (17.1) 6.76 (17) 7.35 (15) 7.16 (15.66) 6.89 (16.59) 7.14 (15.74)
B. Transfers and subsidies 8.66 (5.4) 8.37 (6.5) 8.59 (5.66) 8.97 (4.28) 8.46 (6.15) 8.23 (7) 8.23 (7) 8.23 (7)
F. Contracts 1.93 3.21 3.21 2.53 2.45 2.96 2.96 3.08
G. Real property 4.54 6.14 6.74 6.58 6.34 6.34 6.34
3. Sound Money 5.86 6.59 6.72 6.25 8.01 8.29 8.08 7.99
A. Money growth 7.66 (11.72) 8.46 (7.69) 8.39 (8.04) 8.27 (8.63) 9.41 (2.97) 9.63 (1.83) 9.12 (4.39) 9.12 (4.39)
C. Inflation 7.69 (11.54) 8.50 (7.52) 9.20 (4.01) 7.60 (11.99) 8.83 (5.87) 9.03 (4.86) 8.47 (7.66) 8.97 (5.13)
A. Tariffs 0.00 0.00 4.34 6.38 6.14 6.08 6.52 5.91
(ii) Mean tariff rate 0.00 (74.3) 0.00 (79.2) 3.50 (32.5) 7.48 (12.6) 7.32 (13.4) 6.48 (17.6) 7.00 (15) 6.34 (18.3)
5. Regulation 6.07 5.55 5.93 5.70 6.00 6.10 5.96 5.98
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Indonesia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 2.27 2.72 2.72 2.64 2.97 3.72 3.72 3.72
G. Real property 5.88 5.59 6.07 5.93 6.69 6.69 6.69
3. Sound Money 6.61 8.28 6.40 8.95 9.29 9.65 9.53 9.54
A. Money growth 6.57 (17.15) 6.11 (19.43) 6.33 (18.36) 8.49 (7.55) 9.10 (4.48) 9.73 (1.33) 9.46 (2.68) 9.46 (2.68)
C. Inflation 3.80 (30.99) 9.14 (4.28) 9.26 (3.72) 8.97 (5.13) 8.73 (6.36) 9.36 (3.2) 9.39 (3.03) 9.69 (1.56)
A. Tariffs 6.13 5.88 7.88 7.89 8.10 7.89 7.89 7.89
5. Regulation 2.44 3.85 4.77 5.90 5.90 5.83 5.76 5.91
(vi) Conscription 3.00 0.00 5.00 5.00 5.00 5.00 5.00 5.00

Iran, Islamic Republic 1980 1990 2000 2010 2015 2019 2020 2021
B. Transfers and subsidies 8.23 (7) 8.94 (4.4) 9.52 (2.26) 7.99 (7.88) 7.99 (7.88) 7.99 (7.88) 7.99 (7.88) 7.99 (7.88)
F. Contracts 1.09 3.04 3.04 2.92 2.79 3.08 3.08 3.08
G. Real property 5.84 7.68 5.87 7.90 8.17 8.17 8.17
3. Sound Money 8.19 9.39 8.30 8.61 7.58 7.03 5.99 5.90
A. Money growth 9.78 (1.08) 9.78 (-1.12) 8.35 (-8.24) 9.54 (-2.32) 8.70 (6.52) 8.59 (7.05) 8.59 (7.05) 8.59 (7.05)
C. Inflation 5.32 (23.41) 9.05 (4.73) 7.10 (14.48) 7.97 (10.14) 7.26 (13.7) 6.40 (18.01) 2.02 (39.91) 1.32 (43.39)
A. Tariffs 2.93 6.15 8.34 4.11 4.07 5.37 5.37 5.37
(ii) Mean tariff rate 5.86 (20.7) 5.86 (20.7) 9.02 (4.9) 4.80 (26) 4.68 (26.6) 5.98 (20.1) 5.98 (20.1) 5.98 (20.1)
5. Regulation 4.02 3.85 4.46 4.27 4.87 4.59 4.59 4.49
(vi) Conscription 3.00 0.00 0.00 1.00 1.00 1.00 1.00 1.00

Iraq 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.71 2.44 2.42 2.42 2.42 2.42
G. Real property 7.32 7.32 6.44 6.64 6.64 6.64
3. Sound Money 7.11 7.81 8.18 7.53
A. Money growth 0.00 (83.38) 7.88 (10.6) 8.93 (-5.37) 8.64 (-6.82) 8.64 (-6.82) 8.64 (-6.82)
C. Inflation 9.72 (1.39) 9.93 (0.37) 9.96 (-0.2) 8.79 (6.04)
A. Tariffs 9.67 9.67 9.67
5. Regulation 4.78 4.43 4.61 5.53 5.85 5.87

Ireland 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.42 6.85 6.85 5.98 4.98 4.81 4.81 4.81
G. Real property 5.90 5.90 7.08 8.58 7.27 7.27 7.27
3. Sound Money 5.93 6.80 9.43 9.48 9.53 9.52 9.29 9.22
A. Money growth 8.07 (9.64) 9.25 (3.75) 9.39 (-3.05) 9.23 (3.87) 8.97 (5.17) 8.97 (5.13) 8.15 (9.27) 8.15 (9.27)
C. Inflation 7.06 (14.71) 8.96 (5.18) 8.89 (5.56) 9.81 (-0.95) 9.94 (-0.29) 9.90 (0.49) 9.81 (0.94) 9.53 (2.36)
A. Tariffs 7.95 7.88 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.08 7.93 7.80 7.59 8.43 8.32 8.08 8.20
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Israel 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.11 6.77 5.24 4.82 4.74 4.74 4.74 4.74
G. Real property 4.81 4.81 5.63 5.74 6.93 6.93 6.93
3. Sound Money 1.71 4.35 7.97 9.49 9.69 9.76 9.63 9.58
A. Money growth 1.84 (40.78) 7.10 (14.49) 8.60 (7.01) 9.31 (-3.43) 9.32 (3.39) 9.63 (1.85) 8.96 (5.21) 8.96 (5.21)
C. Inflation 0.00 (134.74) 0.00 (260) 9.77 (1.14) 9.46 (2.69) 9.87 (-0.63) 9.84 (0.81) 9.83 (0.84) 9.70 (1.49)
A. Tariffs 6.60 9.39 9.68 7.40 8.24 8.43 8.46 8.38
5. Regulation 4.23 5.17 6.12 6.93 7.21 7.30 7.09 7.33
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Italy 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 0.00 (72) 1.00 (66) 3.00 (51.05) 5.00 (43-45) 5.00 (47-49) 4.00 (44-47) 4.00 (44-47) 4.00 (44-47)
(ii) Top marginal income and payroll tax rate 1.00 (66) 3.00 (52) 1.00 (61-62) 2.00 (61-62) 1.00 (61-63) 1.00 (61-63) 1.00 (61-63)
F. Contracts 3.25 3.62 3.98 3.64 3.53 3.19 3.19 3.33
G. Real property 9.23 9.19 7.98 8.25 8.25 8.25 8.25
3. Sound Money 5.55 9.28 9.47 9.66 9.74 9.38 9.16 9.09
A. Money growth 7.33 (13.36) 9.20 (4) 8.94 (5.29) 9.33 (3.34) 9.14 (4.3) 7.80 (10.99) 6.86 (15.72) 6.86 (15.72)
C. Inflation 5.82 (20.91) 8.20 (9.01) 9.49 (2.54) 9.69 (1.54) 9.99 (0.04) 9.77 (1.14) 9.88 (0.61) 9.63 (1.87)
A. Tariffs 8.99 8.48 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 5.18 5.97 6.46 6.95 7.15 7.22 7.11 6.89
(vi) Conscription 1.00 3.00 3.00 10.00 10.00 10.00 10.00 10.00

Jamaica 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 9.59 (2) 10.00 (0) 9.76 (1.39) 8.38 (6.45) 8.38 (6.45) 8.38 (6.45) 8.38 (6.45)
F. Contracts 4.88 2.63 3.02 2.88 2.88 2.88
G. Real property 4.49 4.54 5.84 6.44 8.72 8.72 8.72
3. Sound Money 5.28 4.78 8.83 8.06 9.26 9.28 9.14 9.03
A. Money growth 6.90 (15.49) 7.07 (14.67) 9.08 (4.61) 8.53 (7.34) 8.19 (9.07) 8.43 (7.86) 8.00 (9.98) 8.00 (9.98)
C. Inflation 6.33 (18.34) 3.86 (30.69) 8.37 (8.17) 7.48 (12.61) 9.26 (3.68) 9.25 (3.74) 9.22 (3.91) 8.83 (5.86)
A. Tariffs 8.05 6.60 7.28 7.50 7.16 7.06 7.06 7.06
5. Regulation 4.99 7.74 7.54 7.04 7.71 7.66 7.56 7.54
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Japan 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.74 7.49 8.49 7.29 6.69 6.19 6.19 6.19
G. Real property 8.29 8.42 8.09 7.85 8.01 8.01 8.01
3. Sound Money 8.01 9.64 9.80 9.90 9.68 9.78 9.80 9.79
A. Money growth 8.86 (5.68) 9.32 (3.4) 9.70 (1.49) 9.99 (0.03) 9.59 (2.03) 9.69 (1.53) 9.48 (2.6) 9.48 (2.6)
C. Inflation 8.91 (5.44) 9.58 (2.12) 9.86 (-0.71) 9.86 (-0.72) 9.84 (0.79) 9.80 (0.98) 9.90 (0.48) 9.95 (-0.23)
A. Tariffs 8.75 8.23 8.43 7.14 7.71 7.33 7.47 7.53
(ii) Mean tariff rate 8.10 (9.5) 8.62 (6.9) 9.10 (4.5) 9.12 (4.4) 9.20 (4) 9.08 (4.6) 9.12 (4.4) 9.16 (4.2)
5. Regulation 8.16 7.94 7.44 7.65 7.88 7.98 7.82 7.82
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Jordan 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.93 2.94 2.94 3.12 3.12 3.12
G. Real property 6.32 6.30 7.14 6.64 6.72 6.72 6.72
3. Sound Money 7.14 6.14 9.59 8.85 9.77 9.72 9.85 9.83
A. Money growth 8.10 (9.5) 9.52 (2.41) 8.35 (8.25) 9.92 (-0.39) 9.95 (-0.25) 9.91 (0.44) 9.91 (0.44)
C. Inflation 9.78 (1.1) 9.71 (-1.45) 9.87 (0.67) 9.00 (5.01) 9.83 (-0.87) 9.11 (4.46) 9.85 (0.76) 9.73 (1.35)
A. Tariffs 5.27 4.63 4.35 6.95 7.05 7.08 6.99 6.98
(ii) Mean tariff rate 5.20 (24) 8.00 (10) 8.00 (10) 7.98 (10.1) 7.98 (10.1) 7.98 (10.1)
(iii) Standard deviation of tariff rates 2.60 (18.5) 0.88 (22.8) 3.72 (15.7) 4.00 (15) 3.94 (15.15) 3.90 (15.25) 3.86 (15.35)
5. Regulation 6.74 6.04 6.02 7.44 7.39 7.42 7.43 7.55
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Kazakhstan 1980 1990 2000 2010 2015 2019 2020 2021

A. Judicial independence 3.64 3.57 3.42 4.20 4.24 4.25 4.24
F. Contracts 5.22 5.22 4.69 4.31 4.61 4.20 4.20 4.34
G. Real property 8.49 9.21 9.90 9.91 9.91 9.91
3. Sound Money 8.38 8.69 9.24 9.30 9.15
A. Money growth 0.00 (90.38) 7.73 (11.33) 8.50 (7.49) 9.86 (0.71) 9.61 (1.95) 9.61 (1.95)
B. Standard deviation of inflation 7.20 (7) 7.58 (6.05) 8.31 (4.23) 8.64 (3.39) 8.60 (3.5)
C. Inflation 8.58 (7.12) 8.67 (6.65) 8.80 (6) 8.95 (5.24) 8.39 (8.04)
A. Tariffs 9.56 6.70 7.19 7.80 8.16 8.00
5. Regulation 6.45 6.56 7.05 6.91 6.71 6.77
(vi) Conscription 0.00 3.00 3.00 3.00 3.00

Kenya 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.87 3.30 3.46 3.46 3.46 3.67
G. Real property 7.95 7.27 7.41 6.84 7.24 7.24 7.24
3. Sound Money 5.97 6.62 8.85 8.85 8.91 9.43 9.32 9.31
A. Money growth 8.27 (8.65) 8.69 (6.55) 8.97 (5.14) 7.79 (11.03) 8.02 (9.92) 9.81 (0.96) 9.34 (3.28) 9.34 (3.28)
C. Inflation 8.09 (9.55) 8.35 (8.23) 8.00 (9.98) 9.21 (3.96) 8.68 (6.58) 9.06 (4.69) 8.96 (5.2) 8.78 (6.11)
A. Tariffs 3.94 2.81 5.79 6.87 6.74 6.33 6.23 6.37
(iii) Standard deviation of tariff rates 1.36 (21.6) 4.92 (12.7) 5.30 (11.75) 5.20 (12) 4.80 (13) 4.82 (12.96) 4.93 (12.67)
5. Regulation 4.54 5.12 5.42 6.48 6.69 6.17 6.18 6.83
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Korea, Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 8.15 7.79 7.44 6.95 7.09 7.09 7.09 7.09
G. Real property 7.79 7.72 8.12 8.22 8.22 8.22 8.22
3. Sound Money 5.05 6.45 7.70 9.49 9.78 9.64 9.66 9.54
A. Money growth 6.40 (18.02) 8.57 (7.14) 7.37 (13.16) 9.22 (3.89) 9.54 (2.32) 9.44 (2.82) 9.24 (3.8) 9.24 (3.8)
C. Inflation 5.03 (24.87) 8.02 (9.91) 9.55 (2.27) 9.41 (2.93) 9.86 (0.71) 9.70 (1.48) 9.92 (0.38) 9.50 (2.5)
A. Tariffs 6.59 7.46 8.35 5.64 5.60 5.64 5.64 5.64
5. Regulation 4.76 6.77 6.48 7.24 7.49 7.25 7.20 7.30
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Kuwait 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.86 5.03 5.03 5.03 5.03 5.03
G. Real property 8.39 8.39 8.80 8.91 9.51 9.51 9.51
3. Sound Money 4.89 6.29 8.03 8.02 7.77 8.26 8.63 8.20
A. Money growth 6.02 (19.88) 9.65 (-1.76) 8.90 (5.49) 9.55 (2.25) 9.85 (0.76) 9.58 (2.1) 9.58 (2.1)
C. Inflation 1.49 (42.57) 8.03 (9.83) 9.50 (2.51) 9.20 (4.02) 9.35 (3.27) 9.89 (0.54) 9.78 (1.09) 9.32 (3.42)
A. Tariffs 9.20 9.27 8.84 8.78 8.77 8.77 8.79
5. Regulation 5.78 5.67 5.92 6.49 6.54 6.48 6.48 6.54
(vi) Conscription 1.00 0.00 0.00 10.00 10.00 3.00 3.00 3.00

Kyrgyz Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.17 4.62 3.51 3.51 3.51 3.51
G. Real property 8.07 8.99 9.87 9.87 9.87 9.87
3. Sound Money 8.24 8.43 9.42 9.22 8.29
A. Money growth 0.00 (94.38) 7.34 (13.32) 8.29 (8.54) 8.78 (6.1) 8.13 (9.36) 8.13 (9.36)
C. Inflation 8.41 (7.97) 8.70 (6.5) 9.69 (1.54) 9.77 (1.13) 7.62 (11.91)
A. Tariffs 9.69 8.69 8.27 7.97 8.04 8.16
5. Regulation 6.62 6.68 6.64 6.68 6.64 6.77
(vi) Conscription 1.00 1.00 1.00 1.00 1.00

Lao PDR 1980 1990 2000 2010 2015 2019 2020 2021
A. Government consumption 6.62 (17.5) 6.74 (17.09) 6.78 (16.94) 5.55 (21.13)
F. Contracts 2.64 2.60 2.60 1.54 1.54 1.54
G. Real property 6.07 6.10 8.67 8.45 8.45 8.45
3. Sound Money 7.41 7.60 7.54 7.52
A. Money growth 0.00 (95.38) 6.35 (18.24) 6.35 (18.24) 6.35 (18.24) 6.35 (18.24) 6.35 (18.24)
C. Inflation 9.74 (1.28) 9.59 (2.04) 9.34 (3.32) 9.25 (3.76)
A. Tariffs 7.85 8.14 8.14 8.18
(ii) Mean tariff rate 8.00 (10) 8.28 (8.6) 8.28 (8.6) 8.28 (8.6)
5. Regulation 4.70 4.13 5.63 5.55 5.60 5.62
(ii) Private sector credit 8.54 8.25 8.25 8.25
(vi) Conscription 1.00 1.00 1.00 1.00

Latvia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 7.97 7.12 6.51 6.51 6.51 6.51
G. Real property 8.27 8.32 8.49 9.03 9.03 9.03 9.03
3. Sound Money 6.43 8.55 8.93 9.47 9.32 9.06 8.97
A. Money growth 6.81 (15.97) 9.23 (-3.86) 8.75 (6.25) 8.47 (7.67) 7.53 (12.34) 7.53 (12.34)
C. Inflation 6.85 (15.74) 9.47 (2.65) 9.78 (-1.09) 9.96 (0.2) 9.49 (2.53) 9.44 (2.81) 9.34 (3.28)
A. Tariffs 8.33 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.56 7.63 8.29 8.00 7.83 7.75
(vi) Conscription 0.00 3.00 10.00 10.00 10.00 10.00 10.00

Lebanon 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 1.70 1.58 1.58 1.58 1.58 1.77
G. Real property 7.59 7.62 7.42 7.33 7.33 7.33
3. Sound Money 9.33 9.52 9.38 7.32 4.97
A. Money growth 0.00 (97.38) 9.33 (3.34) 9.67 (-1.66) 9.88 (0.62) 9.88 (0.62) 9.88 (0.62)
C. Inflation 9.20 (3.99) 9.25 (-3.75) 8.78 (6.08) 9.40 (3.01) 0.00 (154.76)
A. Tariffs 7.09 7.87 7.81 7.85 7.83
(i) Trade tax revenue 8.67 (2) 9.13 (1.3) 9.15 (1.28) 9.59 (0.62) 9.59 (0.62)
(ii) Mean tariff rate 8.74 (6.3) 8.88 (5.6) 8.86 (5.7) 8.80 (6) 8.80 (6)
5. Regulation 4.12 5.16 5.45 5.34 5.32 5.32
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Lesotho 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.43 2.02 1.96 1.96 1.96 1.96
G. Real property 5.30 5.46 6.49 6.49 6.49 6.49
3. Sound Money 7.85 7.99 8.13 7.94 7.84
A. Money growth 0.00 (98.38) 8.12 (9.42) 8.97 (5.14) 9.63 (1.87) 8.46 (7.71) 8.46 (7.71)
C. Inflation 9.28 (3.58) 9.36 (3.18) 9.20 (4.01) 8.96 (5.19) 8.79 (6.05)
A. Tariffs 0.00 4.67 6.93 7.16 6.64 7.22
5. Regulation 6.72 4.78 5.53 6.23 5.53 5.80 5.83
(vi) Conscription 10.00 10.00 10.00 10.00

Liberia 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 8.82 (10.01) 7.38 (14.92) 1.66 (34.34) 2.25 (32.36)
F. Contracts 1.44 1.44 1.44 1.44 1.44 1.44
G. Real property 4.22 4.72 4.90 4.80 4.80 4.80
3. Sound Money 9.23 8.43 8.33 9.07
A. Money growth 0.00 (99.38) 5.69 (21.57) 9.87 (-0.67) 9.86 (-0.68) 9.86 (-0.68) 9.86 (-0.68)
C. Inflation 8.44 (7.78) 5.29 (23.56) 4.61 (26.97) 8.44 (7.82)
A. Tariffs 7.14 7.02 7.02 7.02
5. Regulation 2.55 3.64 5.23 4.35 4.59 4.59
B. Labor market regulation 4.32 5.01 4.78 4.78 4.78
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Libya 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 1.81 1.81 1.81 1.81 1.81 1.81
G. Real property
3. Sound Money 7.05 7.98 7.79 7.14
A. Money growth 0.00 (100.38) 7.12 (14.38) 7.65 (11.75) 7.91 (10.45) 9.31 (3.47) 9.31 (3.47)
C. Inflation 8.04 (9.8) 9.76 (-1.2) 9.09 (4.56) 9.26 (3.7)
A. Tariffs 8.86
(ii) Mean tariff rate 8.96 (5.2)
(iii) Standard deviation of tariff rates 8.75 (3.12)
5. Regulation 3.66 3.22 5.03 4.40 4.32 4.31
(vi) Conscription 10.00 10.00 10.00 10.00
(ii) Business permits

Lithuania 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 8.13 7.23 6.87 6.87 6.87 6.87
G. Real property 9.65 9.68 9.78 9.67 9.67 9.67 9.67
3. Sound Money 7.49 7.09 9.37 9.41 9.31 9.14 8.97
A. Money growth 7.47 (12.63) 9.76 (-1.22) 8.70 (6.52) 8.43 (7.83) 7.56 (12.18) 7.56 (12.18)
C. Inflation 9.97 (-0.15) 9.80 (1.01) 9.74 (1.32) 9.82 (-0.88) 9.46 (2.69) 9.53 (2.33) 9.06 (4.68)
A. Tariffs 8.50 8.34 8.36 8.20 8.03 8.06
5. Regulation 3.41 5.96 6.90 7.74 7.88 7.53 7.80
(vi) Conscription 0.00 3.00 10.00 3.00 3.00 3.00 3.00

Luxembourg 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 1.00 (56) 4.00 (48.5) 5.00 (39) 5.00 (43) 6.00 (45) 5.00 (46) 5.00 (46)
F. Contracts 8.76 8.73 8.73 8.73 8.73 8.73
G. Real property 6.10 6.07 6.18 6.18 6.18 6.18
3. Sound Money 9.05 9.53 9.75 9.35 9.46 9.31 9.06 9.07
A. Money growth 9.22 (3.88) 9.27 (3.64) 9.81 (0.95) 8.87 (5.65) 8.55 (7.24) 8.27 (8.67) 7.45 (12.77) 7.45 (12.77)
C. Inflation 8.42 (7.92) 9.32 (3.42) 9.37 (3.15) 9.54 (2.28) 9.91 (0.47) 9.69 (1.53) 9.65 (1.74) 9.49 (2.53)
A. Tariffs 9.09 8.52 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 9.09 8.72 8.53 7.88 8.17 8.21 7.93 8.14
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Madagascar 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 9.75 (1.4) 9.86 (1) 10.00 (0.23) 9.26 (3.22) 9.33 (2.97) 9.21 (3.39) 9.56 (2.13)
F. Contracts 3.48 1.21 1.48 1.48 1.48 1.48
G. Real property 3.69 3.85 5.41 5.09 5.15 5.15 5.15
3. Sound Money 5.91 5.77 7.21 7.73 8.01 7.82 7.95 7.93
A. Money growth 7.76 (11.2) 7.28 (13.61) 8.01 (9.97) 8.30 (8.5) 8.97 (5.17) 8.44 (7.82) 8.55 (7.26) 8.55 (7.26)
C. Inflation 7.00 (14.99) 7.71 (11.46) 7.59 (12.03) 8.15 (9.25) 8.52 (7.4) 8.28 (8.6) 8.88 (5.61) 8.84 (5.81)
A. Tariffs 4.02 1.73 4.11 7.86 7.78 7.67 7.64 7.59
5. Regulation 4.08 3.31 4.63 5.97 5.75 5.70 5.41 5.45
(vi) Conscription 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00

Malawi 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 2.94 2.35 2.42 2.42 2.42 2.42
G. Real property 7.19 6.65 7.28 8.14 8.55 8.55 8.55
3. Sound Money 5.87 5.71 2.94 5.41 6.07 6.84 7.12 7.38
A. Money growth 8.99 (5.03) 7.67 (11.63) 5.30 (23.48) 5.08 (24.58) 7.05 (14.74) 7.25 (13.73) 7.25 (13.73) 7.25 (13.73)
C. Inflation 6.84 (15.79) 7.83 (10.85) 4.08 (29.58) 8.52 (7.41) 5.75 (21.25) 7.52 (12.42) 8.13 (9.37) 8.13 (9.34)
A. Tariffs 5.60 6.58 4.96 5.95 7.05 7.34 7.34 7.34
(iii) Standard deviation of tariff rates 4.20 (14.5) 5.78 (10.54) 5.16 (12.1) 6.00 (10) 6.00 (10) 6.00 (10)
5. Regulation 4.05 4.40 4.22 5.76 5.44 5.64 5.73 5.92
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Malaysia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.36 5.83 5.83 5.04 5.42 5.49 5.49 5.49
G. Real property 6.56 6.54 6.42 8.64 8.63 8.63 8.63
3. Sound Money 8.89 8.80 8.30 6.70 9.62 8.40 8.34 8.16
A. Money growth 8.15 (9.27) 7.88 (-10.59) 9.72 (1.41) 9.63 (1.85) 9.84 (0.81) 4.47 (27.66) 4.22 (28.89) 4.22 (28.89)
C. Inflation 8.63 (6.87) 9.41 (2.95) 9.69 (1.53) 9.66 (1.71) 9.58 (2.1) 9.82 (0.88) 9.87 (0.66) 9.50 (2.48)
A. Tariffs 6.37 6.76 5.92 6.92 7.12 7.82 7.69 7.76
5. Regulation 7.06 6.48 6.76 7.44 7.97 7.86 7.70 7.54
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Mali 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.15 2.54 2.57 2.57 2.57 2.57
G. Real property 4.17 4.17 4.45 5.57 5.80 5.80 5.80
3. Sound Money 6.00 7.15 8.33 6.79 6.96 7.25 7.04 6.92
A. Money growth 8.42 (7.89) 9.78 (-1.09) 9.74 (1.29) 9.10 (4.51) 9.11 (4.44) 9.25 (3.73) 8.74 (6.28) 8.74 (6.28)
C. Inflation 6.74 (16.31) 9.45 (2.73) 9.86 (-0.68) 9.78 (1.11) 9.71 (1.44) 9.94 (0.3) 9.67 (-1.66) 9.21 (3.93)
A. Tariffs 5.23 5.97 7.73 7.62 7.55 7.60 7.61 7.61
(ii) Mean tariff rate 3.00 (35) 5.00 (25) 7.60 (12) 7.62 (11.9) 7.56 (12.2) 7.58 (12.1) 7.58 (12.1) 7.58 (12.1)
5. Regulation 4.70 5.39 4.57 5.95 6.18 6.02 6.02 6.00
(vi) Conscription 10.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Malta 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.74 4.74 4.74 5.18 5.18 5.18
G. Real property 8.01 8.01 5.28 5.24 5.24 5.24
3. Sound Money 6.50 7.27 7.00 9.54 9.65 9.56 9.29 9.30
A. Money growth 9.68 (1.6) 10.00 (-0.02) 9.94 (-0.28) 8.59 (7.06) 8.95 (5.24) 8.59 (7.06) 7.64 (11.78) 7.64 (11.78)
B. Standard deviation of inflation 8.80 (3) 9.74 (0.64) 8.51 (3.72) 9.87 (0.32) 9.88 (0.3) 9.88 (0.31) 9.84 (0.41) 9.85 (0.37)
C. Inflation 7.52 (12.4) 9.36 (3.21) 9.53 (2.37) 9.70 (1.52) 9.78 (1.1) 9.77 (1.16) 9.67 (1.64) 9.70 (1.5)
A. Tariffs 6.73 6.73 8.51 8.34 8.36 8.20 8.03 8.06
5. Regulation 5.12 6.58 7.24 7.20 7.88 8.03 7.68 7.78
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
(iv) Tax compliance 7.97 7.97 7.97 7.97

Mauritania 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 0.00 (0) 0.00 (0)
F. Contracts 4.05 4.38 4.38 4.38 4.38 4.59
G. Real property 6.84 7.36 7.56 7.59 7.59 7.59
3. Sound Money 6.51 7.72 7.98 8.34 7.96
A. Money growth 0.00 (108.38) 8.47 (7.64) 9.21 (3.97) 9.13 (4.34) 9.13 (4.34) 9.13 (4.34)
B. Standard deviation of inflation 3.83 (15.42) 6.76 (8.1) 8.40 (4) 9.70 (0.74) 8.40 (3.99)
C. Inflation 8.74 (6.28) 9.90 (0.48) 9.39 (3.07) 9.54 (2.3) 9.29 (3.57)
A. Tariffs 7.64 7.38 7.39 7.39 7.31
(ii) Mean tariff rate 8.08 (9.6) 7.60 (12) 7.58 (12.1) 7.58 (12.1) 7.60 (12)
5. Regulation 4.02 6.05 5.93 6.19 6.19 6.09
(vi) Conscription 5.00 5.00 5.00 5.00 5.00

Mauritius 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.09 4.49 5.02 5.13 5.13 5.35
G. Real property 1.03 5.99 6.25 9.48 9.48 9.48
3. Sound Money 4.75 6.19 9.56 9.36 9.65 9.61 9.58 9.35
A. Money growth 8.50 (7.52) 7.41 (12.94) 9.56 (2.21) 9.15 (4.23) 9.34 (3.32) 9.34 (3.3) 8.62 (6.91) 8.62 (6.91)
C. Inflation 4.69 (26.57) 7.98 (10.12) 9.16 (4.2) 9.42 (2.89) 9.74 (1.29) 9.36 (3.22) 9.92 (0.41) 9.19 (4.03)
A. Tariffs 3.31 3.14 3.54 9.17 9.46 9.41 9.40 9.41
(ii) Mean tariff rate 3.02 (34.9) 4.48 (27.6) 3.80 (31) 9.72 (1.4) 9.80 (1) 9.84 (0.8) 9.84 (0.8) 9.84 (0.8)
5. Regulation 7.63 8.05 7.48 8.14 7.82 7.48 7.03 6.84
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Mexico 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 1.99 (43.04) 7.45 (23.91) 10.00 (13.68) 6.86 (26) 9.67 (16.17) 10.00 (12.63) 10.00 (13.57) 10.00 (13.57)
F. Contracts 6.03 4.72 4.19 3.96 4.21 4.21 4.21 4.21
G. Real property 6.86 6.86 6.89 7.50 7.33 7.33 7.33
3. Sound Money 7.87 3.65 6.91 8.12 8.13 8.17 8.15 8.04
A. Money growth 6.96 (15.19) 0.21 (48.93) 7.43 (12.84) 8.71 (6.46) 8.66 (6.71) 9.10 (4.48) 8.81 (5.96) 8.81 (5.96)
C. Inflation 5.44 (22.8) 4.37 (28.13) 8.10 (9.5) 9.17 (4.16) 9.46 (2.72) 9.02 (4.9) 9.27 (3.64) 8.86 (5.69)
A. Tariffs 1.91 7.88 7.48 6.58 7.83 8.07 8.09 8.27
(ii) Mean tariff rate 3.82 (30.9) 7.78 (11.1) 6.76 (16.2) 8.20 (9) 8.58 (7.1) 8.58 (7.1) 8.58 (7.1) 8.58 (7.1)
5. Regulation 4.54 5.05 6.29 6.64 6.79 6.72 6.65 6.33
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Moldova 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.96 5.72 4.66 4.66 4.66 4.66
G. Real property 8.60 9.61 9.53 9.57 9.57 9.57
3. Sound Money 7.40 7.75 8.20 8.08 8.03
A. Money growth 0.00 (111.38) 8.13 (9.34) 8.72 (6.4) 9.27 (3.67) 8.64 (6.82) 8.64 (6.82)
C. Inflation 8.52 (7.4) 8.06 (9.68) 9.39 (3.05) 9.03 (4.84) 8.98 (5.11)
A. Tariffs 9.23 8.64 8.70 8.69 8.67 8.60
5. Regulation 6.33 6.47 6.58 6.52 6.30 6.42
(vi) Conscription 3.00 3.00 3.00 3.00 3.00

Mongolia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 7.11 6.87 6.64 6.88 6.88 6.88
G. Real property 9.04 9.10 9.11 9.11 9.11 9.11
3. Sound Money 7.58 9.11 8.80 8.76 8.74
A. Money growth 0.00 (112.38) 6.18 (19.08) 9.61 (1.96) 8.25 (8.76) 7.99 (10.04) 7.99 (10.04)
B. Standard deviation of inflation 6.17 (9.57) 8.00 (5) 8.32 (4.19) 8.52 (3.69) 8.44 (3.9)
C. Inflation 7.97 (10.15) 8.84 (5.78) 8.64 (6.81) 8.54 (7.3) 8.53 (7.35)
A. Tariffs 9.13 9.20 8.95 8.93 8.91
(ii) Mean tariff rate 9.00 (5) 9.00 (5) 8.96 (5.2) 8.96 (5.2) 8.96 (5.2)
5. Regulation 7.14 7.05 6.82 7.35 7.38 6.76
(vi) Conscription 3.00 3.00 3.00 3.00 3.00

Montenegro 1980 1990 2000 2010 2015 2019 2020 2021

2. Legal System and Property Rights 4.51 5.30 5.06 5.25 5.67 5.64
E. Integrity of the legal system 5.72 5.89 5.96 5.90 6.70 6.65
F. Contracts 3.54 3.65 3.65 3.65 3.65 3.65
G. Real property 6.16 7.29 7.68 7.68 7.68 7.68
3. Sound Money 8.00 8.44 9.61 9.72 9.61
A. Money growth 0.00 (113.38) 8.66 (6.69) 9.29 (3.57) 9.64 (1.81) 9.76 (1.22) 9.76 (1.22)
B. Standard deviation of inflation 8.48 (3.81) 9.77 (0.58) 9.34 (1.66) 9.20 (2) 9.18 (2.06)
C. Inflation 9.87 (0.65) 9.69 (1.55) 9.48 (2.61) 9.93 (0.36) 9.52 (2.41)
A. Tariffs 8.13 8.23 8.33 8.31 8.32
(ii) Mean tariff rate 9.02 (4.9) 9.20 (4) 9.26 (3.7) 9.26 (3.7) 9.26 (3.7)
5. Regulation 7.47 7.33 7.44 7.95 7.95 7.93
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Morocco 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.07 4.72 5.19 4.02 4.28 4.09 4.09 4.23
G. Real property 6.98 6.45 7.50 7.64 7.52 7.52 7.52
3. Sound Money 6.20 6.61 6.99 7.04 7.30 7.34 7.34 7.21
A. Money growth 8.49 (7.56) 8.52 (7.4) 8.73 (6.37) 9.19 (4.04) 9.96 (0.19) 9.89 (0.54) 9.53 (2.37) 9.53 (2.37)
C. Inflation 8.11 (9.46) 8.87 (5.66) 9.62 (1.89) 9.80 (0.99) 9.69 (1.56) 9.62 (1.91) 9.96 (0.2) 9.72 (1.4)
A. Tariffs 1.43 4.78 3.19 5.55 6.80 6.84 6.62 6.21
5. Regulation 4.27 4.71 4.79 6.24 6.69 6.59 6.48 6.51
(vi) Conscription 1.00 1.00 1.00 10.00 10.00 3.00 3.00 3.00

Mozambique 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.81 1.25 1.25 2.13 2.13 1.81
G. Real property 4.21 7.50 5.49 7.47 7.54 7.54 7.54
3. Sound Money 5.85 6.40 7.95 6.56 6.50
A. Money growth 6.69 (16.56) 7.35 (13.23) 7.60 (12.01) 9.57 (2.15) 8.90 (5.5) 8.90 (5.5)
C. Inflation 7.46 (12.7) 9.29 (3.55) 9.22 (3.9) 9.44 (2.78) 8.86 (5.69)
A. Tariffs 7.98 7.89 8.02 7.97 7.97
5. Regulation 4.07 5.46 5.39 5.75 5.75 5.79
(vi) Conscription 0.00 0.00 0.00 0.00 0.00

Myanmar 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 0.94 0.94 0.94 0.94 0.94 0.94
G. Real property 5.50 5.50 6.72 7.36 7.36 7.36
3. Sound Money 6.77 4.28 5.37 5.49 6.07 6.59 6.50 6.66
A. Money growth 8.75 (6.27) 7.68 (11.58) 6.27 (18.64) 6.75 (16.23) 6.85 (15.77) 8.59 (7.05) 8.52 (7.42) 8.52 (7.42)
C. Inflation 9.75 (1.24) 6.29 (18.54) 9.98 (-0.11) 8.46 (7.72) 7.84 (10.8) 8.63 (6.87) 8.23 (8.83) 8.73 (6.33)
A. Tariffs 0.53 0.00 0.00 5.35 8.47 8.52 8.51 8.52
5. Regulation 0.75 0.72 4.19 4.36 5.78 5.13 5.51 5.19
(vi) Conscription 3.00 3.00 3.00 0.00 0.00 0.00 0.00 0.00

Namibia 1980 1990 2000 2010 2015 2019 2020 2021

A. Government consumption 3.40 (28.44) 1.50 (34.91) 2.24 (32.4) 3.30 (28.79) 3.79 (27.11) 3.82 (27.01) 3.53 (28) 4.34 (25.24)
F. Contracts 4.61 4.38 3.66 3.66 3.66 3.66
G. Real property 6.38 6.41 6.41 4.48 4.63 4.63 4.63
3. Sound Money 5.44 6.34 6.04 6.75 6.67 6.73 6.70
A. Money growth 8.66 (6.69) 6.93 (15.35) 9.45 (2.76) 9.04 (4.82) 8.68 (6.61) 8.68 (6.61)
C. Inflation 8.33 (8.34) 8.00 (10.02) 9.11 (4.47) 9.32 (3.41) 9.14 (4.29) 9.26 (3.72) 9.28 (3.62)
A. Tariffs 8.12 6.14 5.40 6.24 5.58 5.21 4.48 5.71
5. Regulation 7.32 6.05 6.37 6.62 5.84 5.84 5.54
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Nepal 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 2.91 (39.83) 0.63 (47.8) 3.98 (36.05) 8.50 (20.26) 9.78 (15.78) 9.43 (17) 8.98 (18.58) 8.23 (21.2)
F. Contracts 3.13 1.69 1.69 1.67 1.67 1.67
G. Real property 7.77 7.92 8.33 8.33 7.98 7.98 7.98
3. Sound Money 5.96 6.20 7.15 5.89 6.33 6.74 6.55 6.63
A. Money growth 7.52 (12.38) 7.47 (12.63) 9.92 (-0.38) 6.86 (15.72) 7.75 (11.25) 8.37 (8.14) 8.07 (9.65) 8.07 (9.65)
C. Inflation 8.48 (7.61) 7.86 (10.71) 9.50 (2.48) 8.00 (9.98) 8.43 (7.87) 9.16 (4.2) 8.89 (5.57) 9.18 (4.09)
A. Tariffs 4.92 4.81 6.10 6.29 6.18 5.93 5.85 4.76
5. Regulation 3.63 5.11 5.69 5.97 6.55 6.84 6.83 6.97
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Netherlands 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 8.35 (20.77) 9.46 (16.87) 9.35 (17.27) 8.14 (21.52) 9.82 (15.64) 9.70 (16.04) 9.50 (16.76) 9.71 (16)
F. Contracts 8.99 8.99 8.99 7.62 7.55 7.71 7.71 7.71
G. Real property 7.80 7.92 7.87 7.95 7.95 7.95 7.95
3. Sound Money 9.43 9.64 9.57 9.56 9.75 9.31 9.07 9.10
A. Money growth 9.47 (2.64) 9.45 (2.74) 9.26 (3.7) 8.92 (5.4) 9.34 (3.32) 8.04 (9.81) 7.19 (14.06) 7.19 (14.06)
C. Inflation 8.90 (5.52) 9.54 (2.31) 9.50 (2.52) 9.75 (1.27) 9.88 (0.6) 9.66 (1.7) 9.47 (2.63) 9.46 (2.68)
A. Tariffs 8.99 8.44 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.16 7.06 7.84 7.77 7.73 7.92 7.60 7.67
(vi) Conscription 1.00 1.00 10.00 10.00 10.00 10.00 10.00 10.00

New Zealand 1980 1990 2000 2010 2015 2019 2020 2021
(i) Top marginal income tax rate 2.00 (61.5) 7.00 (33) 5.00 (39) 5.00 (36) 7.00 (33) 7.00 (33) 7.00 (33) 6.00 (39)
F. Contracts 9.85 8.74 8.59 8.59 8.59 8.32
G. Real property 9.90 9.93 9.93 9.95 9.90 9.90 9.90
3. Sound Money 5.94 8.19 9.74 9.48 9.65 9.67 9.58 9.42
A. Money growth 7.65 (11.74) 5.45 (22.77) 9.99 (0.04) 9.17 (4.17) 9.44 (2.8) 9.46 (2.71) 9.30 (3.49) 9.30 (3.49)
B. Standard deviation of inflation 9.20 (2) 7.84 (5.39) 9.48 (1.29) 9.34 (1.66) 9.22 (1.96) 9.54 (1.14) 9.36 (1.6) 9.17 (2.08)
C. Inflation 6.93 (15.36) 9.46 (2.7) 9.48 (2.62) 9.42 (2.91) 9.95 (0.23) 9.68 (1.6) 9.68 (1.62) 9.21 (3.94)
A. Tariffs 7.87 6.56 9.01 9.10 9.13 9.15 9.04 9.04
(ii) Mean tariff rate 7.40 (13) 7.10 (14.5) 9.32 (3.4) 9.58 (2.1) 9.60 (2) 9.60 (2) 9.62 (1.9) 9.62 (1.9)
5. Regulation 7.47 8.67 9.05 9.28 9.29 9.15 8.83 8.95
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Nicaragua 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.40 3.63 3.82 3.82 3.82 3.50
G. Real property 5.49 6.63 6.41 7.30 6.97 6.97 6.97
3. Sound Money 5.99 0.00 8.38 8.70 9.08 9.57 9.58 9.59
A. Money growth 6.74 (16.29) 0.00 (1678.44) 6.44 (17.78) 8.19 (9.04) 8.07 (9.63) 9.92 (-0.4) 9.77 (1.14) 9.77 (1.14)
C. Inflation 2.68 (36.62) 0.00 (5012.69) 7.81 (10.94) 8.91 (5.45) 9.20 (4) 9.01 (4.95) 8.92 (5.38) 9.01 (4.93)
A. Tariffs 2.10 6.09 8.77 8.49 8.47 8.51 8.51 8.51
5. Regulation 2.62 2.82 5.88 6.36 6.32 6.10 6.07 6.02
(vi) Conscription 5.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00

Niger 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 8.55 (20.07) 0.00 (64.8) 0.00 (58.51) 10.00 (14.98) 5.49 (30.79) 4.57 (34) 4.59 (33.94) 4.69 (33.58)
F. Contracts 5.21 3.87 4.08 4.70 4.70 5.11
G. Real property 4.34 4.47 5.72 6.38 7.32 7.32 7.32
3. Sound Money 4.88 7.03 8.24 6.41 6.83 7.14 7.24 7.16
A. Money growth 5.81 (20.96) 9.56 (2.19) 8.99 (-5.07) 7.03 (14.83) 8.24 (8.79) 9.62 (-1.89) 9.90 (-0.48) 9.90 (-0.48)
C. Inflation 5.84 (20.82) 9.68 (-1.6) 9.42 (2.9) 9.84 (0.8) 9.80 (1.01) 9.41 (2.97) 9.50 (-2.49) 9.23 (3.84)
A. Tariffs 4.40 3.47 7.60 6.24 6.13 6.15 6.15 6.15
5. Regulation 6.33 5.57 3.94 5.06 6.04 5.93 6.12 6.14
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Nigeria 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.19 3.19 3.19 3.69 3.04 3.70 3.70 3.84
G. Real property 0.00 0.00 3.45 5.23 4.55 4.55 4.55
3. Sound Money 5.89 4.27 5.36 6.42 8.00 8.70 9.09 8.81
A. Money growth 6.61 (16.96) 6.60 (17.01) 5.86 (20.71) 5.44 (22.82) 9.43 (2.87) 8.56 (7.22) 9.13 (4.35) 9.13 (4.35)
C. Inflation 7.52 (12.42) 8.57 (7.16) 8.61 (6.93) 7.26 (13.72) 8.20 (9.02) 7.58 (12.09) 7.72 (11.4) 6.61 (16.95)
A. Tariffs 3.91 3.49 3.76 7.26 7.29 7.31 7.31 7.31
(i) Trade tax revenue 4.33 (8.5) 7.33 (4)
5. Regulation 2.13 2.82 5.51 6.19 6.38 6.77 6.66 6.77
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

North Macedonia 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.57 4.08 3.22 3.22 3.22 3.22
G. Real property 7.39 7.42 7.85 8.38 8.38 8.38 8.38
3. Sound Money 8.05 8.46 8.30 8.25 8.19
A. Money growth 6.43 (17.85) 8.37 (8.16) 9.60 (2.02) 9.26 (3.69) 9.02 (4.92) 9.02 (4.92)
C. Inflation 9.68 (1.61) 9.94 (-0.3) 9.71 (1.46) 9.85 (0.77) 9.35 (3.23)
A. Tariffs 8.05 8.23 8.26 8.27 8.26
5. Regulation 6.70 8.10 8.02 7.83 7.78 7.69
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Norway 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 9.63 9.35 9.35 8.75 8.58 8.20 8.20 8.20
G. Real property 9.16 9.16 9.12 9.12 9.12 9.12 9.12
3. Sound Money 6.27 9.28 9.14 9.14 7.03 9.32 9.30 8.83
A. Money growth 8.74 (6.28) 8.98 (5.11) 9.62 (1.91) 9.23 (3.86) 9.81 (0.93) 9.24 (3.81) 9.16 (4.2) 9.16 (4.2)
C. Inflation 7.38 (13.12) 9.23 (3.87) 9.38 (3.09) 9.52 (2.4) 9.57 (2.17) 9.45 (2.76) 9.57 (2.17) 9.30 (3.48)
A. Tariffs 9.28 8.63 7.55 6.16 6.19 6.24 6.24 6.24
(ii) Mean tariff rate 8.76 (6.2) 8.86 (5.7) 9.42 (2.9) 8.60 (7) 8.68 (6.6) 8.80 (6) 8.82 (5.9) 8.82 (5.9)
5. Regulation 6.76 7.24 7.49 7.35 7.91 7.73 7.51 7.32
(vi) Conscription 1.00 1.00 3.00 1.00 1.00 0.00 0.00 0.00

Oman 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.71 5.07 5.07 5.02 5.02 5.02
G. Real property 8.71 8.71 8.71 8.71 7.69 7.69 7.69
3. Sound Money 5.10 7.75 8.19 7.43 8.48 8.60 8.81 8.69
A. Money growth 8.17 (9.16) 9.77 (-1.16) 9.13 (4.34) 8.13 (9.36) 9.17 (4.17) 9.40 (3) 9.40 (3) 9.40 (3)
C. Inflation 0.00 (51.11) 6.68 (16.62) 9.75 (-1.27) 9.36 (3.2) 9.99 (0.07) 9.82 (0.88) 9.97 (0.13) 9.69 (1.55)
A. Tariffs 9.33 9.38 7.92 8.08 7.83 7.84 7.91
(i) Trade tax revenue 9.33 (1) 9.55 (0.67) 9.41 (0.89) 9.63 (0.56) 9.63 (0.56) 9.63 (0.56) 9.63 (0.56)
5. Regulation 7.51 8.02 7.62 7.76 6.69 7.05 6.57 6.27
(v) Costs of worker dismissal 9.63 10.00
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Pakistan 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.21 3.95 3.95 3.35 3.17 3.17 3.17 3.17
G. Real property 6.89 8.02 6.69 5.56 6.64 6.64 6.64
3. Sound Money 6.40 8.04 6.25 5.98 6.45 6.70 6.27 6.37
A. Money growth 8.07 (9.63) 9.40 (3.02) 8.95 (5.24) 8.71 (6.43) 8.58 (7.11) 8.99 (5.04) 8.83 (5.83) 8.83 (5.83)
C. Inflation 8.19 (9.06) 8.71 (6.45) 9.13 (4.37) 7.22 (13.88) 9.49 (2.54) 8.98 (5.08) 7.88 (10.58) 8.10 (9.5)
A. Tariffs 0.00 0.00 2.79 4.99 7.15 7.04 7.04 7.04
5. Regulation 3.69 3.78 4.53 5.74 5.56 5.50 5.70 5.76
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Panama 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 2.86 (39.98) 10.00 (12.43) 10.00 (12.65) 9.08 (18.23) 10.00 (14) 9.65 (16.22) 10.00 (10.8) 10.00 (10.8)
F. Contracts 5.27 3.63 3.99 3.85 3.85 3.85
G. Real property 8.38 8.38 8.61 8.79 8.82 8.82 8.82
3. Sound Money 6.56 9.77 9.46 9.17 9.03 9.48 9.45 9.36
A. Money growth 7.37 (13.14) 9.68 (-1.61) 8.85 (5.73) 8.45 (7.74) 8.45 (7.74) 8.45 (7.74) 8.45 (7.74) 8.45 (7.74)
C. Inflation 3.26 (33.69) 9.89 (0.57) 9.70 (1.5) 9.30 (3.49) 9.97 (0.13) 9.85 (0.76) 9.93 (-0.36) 9.67 (1.63)
A. Tariffs 7.93 5.40 7.49 7.88 8.09 8.32 8.28 8.28
5. Regulation 5.36 7.67 6.99 7.12 7.24 6.84 6.59 6.55
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Papua New Guinea 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.57 3.01 3.01 3.01 3.01 3.01
G. Real property 6.93 6.93 6.96 6.93 6.93 6.93 6.93
3. Sound Money 5.74 6.80 6.29 7.35 6.56 6.55 6.92 6.71
A. Money growth 7.42 (12.89) 9.64 (1.8) 9.81 (0.97) 8.15 (9.27) 9.84 (-0.81) 9.42 (-2.91) 9.42 (-2.91) 9.42 (-2.91)
C. Inflation 8.58 (7.09) 9.17 (4.13) 6.88 (15.6) 8.80 (6.02) 8.80 (6.01) 9.06 (4.72) 9.27 (3.64) 9.10 (4.48)
A. Tariffs 7.80 6.93 4.80 7.06 7.25 7.09 7.26 7.16
(ii) Mean tariff rate 8.60 (7) 5.78 (21.1) 8.98 (5.1) 9.06 (4.7) 9.18 (4.1) 9.20 (4) 9.16 (4.2)
5. Regulation 4.96 5.20 6.73 7.16 6.63 6.30 6.47 6.40
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Paraguay 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.48 3.34 3.29 3.29 3.29 3.29
G. Real property 8.44 8.44 7.98 8.51 8.54 8.54 8.54
3. Sound Money 7.88 6.27 8.86 8.53 9.16 9.44 9.44 9.25
A. Money growth 6.97 (15.17) 3.74 (31.28) 9.22 (3.89) 6.79 (16.07) 8.60 (6.99) 9.38 (3.1) 8.80 (6.02) 8.80 (6.02)
C. Inflation 6.66 (16.71) 2.74 (36.28) 8.20 (8.98) 9.07 (4.65) 9.37 (3.13) 9.20 (3.98) 9.45 (2.76) 9.04 (4.79)
A. Tariffs 3.00 6.51 7.63 7.86 7.96 7.97 7.99 8.00
5. Regulation 4.87 5.58 6.41 6.46 6.55 6.44 6.57
(vi) Conscription 1.00 0.00 0.00 1.00 1.00 3.00 3.00 3.00

Peru 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.95 4.43 3.91 3.86 4.11 3.95 3.95 3.95
G. Real property 8.32 8.32 8.65 8.79 8.54 8.54 8.54
3. Sound Money 1.05 1.25 9.13 9.18 9.45 9.76 9.70 9.44
A. Money growth 1.11 (44.43) 0.00 (622.43) 8.39 (8.07) 8.07 (9.64) 9.04 (4.81) 9.72 (1.41) 9.72 (1.41) 9.72 (1.41)
C. Inflation 0.00 (65.92) 0.00 (6134.79) 9.25 (3.76) 9.69 (1.53) 9.29 (3.56) 9.74 (1.32) 9.57 (2.14) 9.15 (4.27)
A. Tariffs 1.47 3.40 7.80 8.61 9.17 9.23 9.23 9.23
5. Regulation 3.77 3.63 6.42 7.31 7.28 7.24 6.92 7.15
(vi) Conscription 0.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00

Philippines 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.55 4.56 4.56 4.14 4.12 4.46 4.46 4.46
G. Real property 7.80 7.50 7.96 7.93 7.93 7.93 7.93
3. Sound Money 5.93 5.74 9.22 9.44 9.44 9.42 9.58 9.51
A. Money growth 7.73 (11.36) 6.86 (15.68) 8.37 (8.14) 9.34 (3.28) 8.75 (6.25) 9.39 (3.06) 9.28 (3.61) 9.28 (3.61)
C. Inflation 7.15 (14.25) 7.41 (12.97) 9.21 (3.95) 9.24 (3.81) 9.71 (1.43) 8.96 (5.21) 9.50 (2.48) 9.21 (3.93)
A. Tariffs 3.93 5.69 7.86 7.75 7.70 7.66 7.56 7.54
5. Regulation 3.86 6.85 6.56 6.84 7.10 6.77 6.66 6.62
(vi) Conscription 3.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Poland 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 2.00 (52.7) 4.00 (44) 4.00 (44) 5.00 (47) 5.00 (47) 4.00 (51)
F. Contracts 4.82 4.82 4.82 4.76 4.71 4.71 4.71 4.71
G. Real property 5.62 5.75 6.11 9.28 7.35 7.35 7.35
3. Sound Money 7.42 3.33 7.14 8.17 8.45 8.40 8.24 8.09
A. Money growth 7.56 (12.19) 8.72 (6.4) 9.53 (2.35) 9.39 (3.04) 8.99 (5.04) 8.99 (5.04)
B. Standard deviation of inflation 9.21 (1.97) 0.00 (167.57) 8.00 (5) 9.51 (1.21) 9.47 (1.31) 9.55 (1.12) 9.41 (1.49) 9.37 (1.57)
C. Inflation 8.04 (9.8) 0.00 (435.66) 7.99 (10.06) 9.46 (2.71) 9.80 (-0.99) 9.64 (1.81) 9.55 (2.23) 8.99 (5.06)
A. Tariffs 6.70 7.76 8.34 8.36 8.20 8.03 8.06
(i) Trade tax revenue 6.00 (6) 9.20 (1.2) 9.63 (0.55) 9.10 (1.35) 9.13 (1.3) 8.60 (2.1) 8.60 (2.1)
5. Regulation 2.85 3.82 7.03 7.16 7.59 7.21 6.92 7.09
(vi) Conscription 0.00 0.00 3.00 10.00 10.00 10.00 10.00 10.00

Portugal 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.75 5.00 6.00 5.52 4.83 4.48 4.48 4.48
G. Real property 6.00 6.00 7.34 7.58 7.41 7.41 7.41
3. Sound Money 6.07 6.40 9.63 9.54 9.66 9.41 9.22 9.17
A. Money growth 9.79 (1.07) 9.60 (1.98) 9.24 (3.81) 8.94 (5.32) 9.17 (4.17) 7.90 (10.48) 7.01 (14.95) 7.01 (14.95)
C. Inflation 5.82 (20.9) 7.45 (12.77) 9.43 (2.85) 9.72 (1.39) 9.90 (0.49) 9.80 (0.99) 9.93 (0.34) 9.75 (1.27)
A. Tariffs 8.60 8.26 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 5.90 6.13 6.60 6.25 7.19 7.16 6.71 6.87
(vi) Conscription 0.00 0.00 5.00 10.00 10.00 10.00 10.00 10.00

Qatar 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.93 4.93 4.93 4.93 4.93 4.93
G. Real property 9.60 9.60 9.66 9.88 9.88 9.88
3. Sound Money 8.15 8.51 8.44 8.70 8.32
A. Money growth 0.00 (135.38) 9.70 (-1.49) 9.91 (0.44) 9.56 (-2.22) 9.67 (1.66) 9.67 (1.66)
C. Inflation 9.51 (-2.43) 9.62 (1.88) 9.95 (0.26) 9.87 (-0.67) 9.54 (2.3)
A. Tariffs 8.33 8.53 8.20 8.35 5.36
(ii) Mean tariff rate 9.00 (5) 9.06 (4.7) 9.04 (4.8) 8.98 (5.1) 0.00 (51)
5. Regulation 6.19 8.01 7.26 6.64 6.61 6.27
(vi) Conscription 10.00 5.00 3.00 3.00 3.00

Romania 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 6.09 4.92 4.92 5.02 5.02 5.02
G. Real property 7.63 6.13 8.67 9.14 9.30 9.30 9.30
3. Sound Money 6.22 7.06 1.99 8.99 9.54 9.33 9.29 9.30
A. Money growth 8.12 (9.39) 7.10 (14.49) 8.20 (8.98) 9.26 (3.68) 9.03 (4.85) 8.68 (6.59) 8.68 (6.59)
C. Inflation 9.88 (0.59) 7.26 (13.72) 0.87 (45.67) 8.78 (6.09) 9.88 (-0.59) 9.07 (4.63) 9.23 (3.83) 8.99 (5.05)
A. Tariffs 9.73 6.76 8.34 8.36 8.20 8.03 8.06
5. Regulation 0.93 2.08 5.97 7.08 7.53 7.15 6.91 7.03
(vi) Conscription 1.00 0.00 3.00 10.00 10.00 10.00 10.00 10.00

Russian Federation 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 5.52 6.07 4.41 4.59 4.22 4.22 4.22 4.22
G. Real property 9.14 8.89 9.15 9.65 9.70 9.70 9.70
3. Sound Money 4.64 5.25 3.11 8.24 8.26 9.39 9.04 8.66
A. Money growth 0.00 (137.38) 6.86 (15.68) 7.80 (11) 9.28 (3.6) 8.44 (7.81) 8.44 (7.81)
C. Inflation 6.82 (15.9) 5.84 (20.78) 8.63 (6.86) 6.89 (15.53) 9.42 (2.88) 9.11 (4.47) 8.66 (6.69)
A. Tariffs 7.00 4.91 6.48 7.16 7.70 7.41
5. Regulation 1.35 1.63 4.75 5.66 5.86 6.03 5.89 5.58
(vi) Conscription 0.00 0.00 0.00 3.00 3.00 3.00 3.00 3.00

Rwanda 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 0.00 (76.12) 2.73 (40.46) 0.00 (65.35) 0.93 (46.74) 0.37 (48.7) 0.57 (48) 0.57 (48) 0.57 (48)
F. Contracts 5.25 4.36 4.37 4.90 4.90 4.90
G. Real property 1.81 1.84 8.70 9.74 9.83 9.83 9.83
3. Sound Money 6.43 6.05 7.24 9.05 9.30 9.45 9.07 9.21
A. Money growth 8.33 (8.35) 9.56 (2.2) 7.83 (10.84) 8.84 (5.79) 8.70 (6.48) 9.15 (4.27) 8.42 (7.91) 8.42 (7.91)
C. Inflation 9.39 (3.06) 7.31 (13.46) 9.14 (4.29) 9.54 (2.31) 9.50 (2.52) 9.94 (-0.31) 9.33 (3.35) 9.92 (-0.39)
A. Tariffs 1.13 0.53 7.03 7.07 7.19 7.07 7.09
5. Regulation 4.65 4.01 6.11 7.77 7.55 7.15 6.84 6.85
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Saudi Arabia 1980 1990 2000 2010 2015 2019 2020 2021
A. Government consumption 0.07 (39.76) 0.00 (42) 0.51 (38.27) 0.00 (40.03) 0.86 (37.06)
F. Contracts 6.06 5.51 5.51 4.67 4.90 4.82 4.82 4.82
G. Real property 9.92 9.96 9.94 9.97 9.97 9.97
3. Sound Money 8.06 8.40 8.69 9.04 8.86
A. Money growth 0.00 (139.38) 9.70 (1.52) 9.31 (3.44) 9.68 (1.58) 9.68 (1.58) 9.68 (1.58)
C. Inflation 8.93 (5.34) 9.56 (2.18) 9.51 (2.47) 9.58 (-2.09) 9.39 (3.06)
A. Tariffs 8.63 8.38 8.19 6.29 6.18
5. Regulation 4.99 7.54 5.91 6.44 6.23 6.21
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Senegal 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 8.99 (4.2) 10.00 (0.43) 10.00 (0) 9.73 (1.49) 9.37 (2.82) 8.91 (4.51) 8.91 (4.51)
F. Contracts 3.93 2.94 2.65 2.93 2.93 2.93
G. Real property 2.26 2.85 2.66 5.31 6.89 6.89 6.89
3. Sound Money 6.28 7.08 7.24 6.92 7.07 7.17 7.15 7.14
A. Money growth 8.47 (7.63) 9.56 (-2.2) 9.27 (3.67) 9.00 (5.02) 8.93 (5.34) 9.13 (4.37) 9.16 (4.22) 9.16 (4.22)
C. Inflation 7.69 (11.53) 9.76 (1.19) 9.85 (0.73) 9.75 (1.25) 9.97 (0.15) 9.91 (0.46) 9.65 (1.76) 9.56 (2.18)
A. Tariffs 2.40 2.57 6.02 7.33 7.37 7.26 7.26 8.02
(ii) Mean tariff rate 3.00 (35) 7.60 (12) 7.62 (11.9) 7.56 (12.2) 7.58 (12.1) 7.58 (12.1) 7.58 (12.1)
5. Regulation 6.31 6.35 4.78 5.75 5.80 6.01 6.05 6.05
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Serbia 1980 1990 2000 2010 2015 2019 2020 2021

D. Military interference 6.67 6.67 6.67 6.67 6.67
F. Contracts 3.54 3.21 2.85 2.94 2.94 3.15
G. Real property 6.16 6.98 8.68 8.52 8.52 8.52
3. Sound Money 7.45 8.10 8.35 8.27 8.02
A. Money growth 0.00 (141.38) 7.38 (13.12) 8.98 (5.1) 8.90 (5.48) 8.53 (7.33) 8.53 (7.33)
C. Inflation 8.77 (6.14) 9.72 (1.39) 9.61 (1.96) 9.63 (1.85) 9.18 (4.09)
A. Tariffs 8.17 8.36 8.38 8.38 8.38
5. Regulation 5.88 5.91 6.72 7.09 6.60 6.83
(vi) Conscription 3.00 10.00 10.00 10.00 10.00

Seychelles 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.83 5.83 5.78 5.78 5.78 5.13
G. Real property 7.08 7.08 7.08 7.08 7.08 7.08
3. Sound Money 9.37 9.17 8.89 8.56
A. Money growth 7.58 (12.12) 8.33 (8.34) 8.62 (6.88) 8.93 (5.37) 8.69 (6.55) 8.83 (5.85) 7.80 (10.99) 7.80 (10.99)
C. Inflation 9.19 (4.04) 9.26 (3.7) 9.64 (1.81) 8.05 (9.77)
A. Tariffs 8.20 8.28 8.30 8.33
5. Regulation 4.87 6.77 7.28 7.53 6.70 6.78
(vi) Conscription 10.00 10.00 10.00 10.00

Sierra Leone 1980 1990 2000 2010 2015 2019 2020 2021
B. Transfers and subsidies 9.70 (1.6) 9.71 (1.57) 10.00 (0) 10.00 (0.27) 10.00 (0.14) 10.00 (0.14) 10.00 (0.14)
F. Contracts 4.39 2.04 3.34 3.34 3.34 3.34
G. Real property 0.56 3.90 1.46 5.42 5.46 5.46 5.46
3. Sound Money 5.91 0.04 6.52 6.78 7.03 7.04 7.04 7.21
A. Money growth 6.70 (16.48) 0.16 (49.21) 4.56 (27.2) 7.05 (14.75) 7.88 (10.62) 8.42 (7.92) 7.54 (12.29) 7.54 (12.29)
C. Inflation 8.02 (9.9) 0.00 (89.15) 9.83 (-0.84) 6.67 (16.64) 8.40 (7.98) 6.79 (16.03) 7.04 (14.8) 7.63 (11.87)
A. Tariffs 2.99 7.37 3.37 6.82 7.74 7.42 7.42 7.42
5. Regulation 3.81 2.51 4.13 5.71 4.96 4.55 4.83 4.76
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Singapore 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 7.82 9.22 9.22 8.67 8.55 8.55 8.55 8.55
G. Real property 8.94 8.91 8.99 8.96 8.96 8.96 8.96
3. Sound Money 6.37 9.05 9.52 9.29 9.86 9.77 9.60 9.45
A. Money growth 9.19 (4.06) 8.29 (8.53) 9.66 (1.71) 9.17 (4.17) 9.92 (-0.42) 9.69 (1.56) 9.28 (3.58) 9.28 (3.58)
C. Inflation 7.71 (11.47) 9.02 (4.92) 9.73 (1.36) 9.44 (2.8) 9.89 (-0.54) 9.91 (0.44) 9.89 (0.57) 9.54 (2.3)
A. Tariffs 9.84 9.70 9.95 10.00 9.99 10.00 10.00 10.00
(i) Trade tax revenue 9.73 (0.4) 9.91 (0.14) 9.93 (0.11) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
(ii) Mean tariff rate 9.94 (0.3) 9.92 (0.4) 9.92 (0.4) 10.00 (0) 9.96 (0.2) 10.00 (0) 10.00 (0) 10.00 (0)
(iii) Standard deviation of tariff rates 9.28 (1.8) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
5. Regulation 7.53 8.35 8.53 8.94 8.81 8.77 8.53 8.74
(v) Costs of worker dismissal 9.63 10.00 #VALUE! 10.00 10.00 10.00
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Slovak Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 5.15 4.69 4.17 4.38 4.38 4.38
G. Real property 8.57 9.65 9.65 9.69 9.69 9.69 9.69
3. Sound Money 8.81 7.90 9.81 9.74 9.32 9.10 9.14
A. Money growth 9.81 (-0.94) 9.95 (-0.25) 9.34 (3.3) 8.32 (8.38) 7.41 (12.93) 7.41 (12.93)
C. Inflation 8.63 (6.86) 7.59 (12.04) 9.81 (0.96) 9.93 (-0.33) 9.50 (2.51) 9.47 (2.66) 9.37 (3.15)
A. Tariffs 9.07 8.34 8.36 8.20 8.03 8.06
C. Black-market exchange rates 10.00 10.00 10.00 10.00 10.00 10.00
(ii) Capital controls 3.08 5.38 5.38 5.38 5.38 3.85
5. Regulation 6.95 7.35 7.22 7.42 6.95 7.09
(vi) Conscription 3.00 10.00 10.00 10.00 10.00 10.00

Slovenia 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 10.00 (13.51) 7.64 (23.27) 7.16 (24.94) 8.77 (19.32) 8.02 (21.94) 7.71 (23)
F. Contracts 5.79 5.86 5.87 5.86 5.86 5.86
G. Real property 4.34 4.34 4.34 8.41 8.32 8.32 8.32
3. Sound Money 7.49 9.55 9.77 9.57 9.38 9.38
A. Money growth 7.62 (11.91) 9.41 (2.96) 9.30 (3.52) 8.90 (5.5) 8.09 (9.54) 8.09 (9.54)
C. Inflation 8.22 (8.88) 9.63 (1.84) 9.90 (-0.52) 9.65 (1.74) 9.67 (1.63) 9.62 (1.92)
A. Tariffs 8.05 8.34 8.36 8.20 8.03 8.06
5. Regulation 6.50 6.84 7.07 7.09 6.68 6.81
(vi) Conscription 3.00 10.00 10.00 10.00 10.00 10.00

Somalia 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 9.77 (1.35) 9.77 (1.35)
B. Impartial courts 0.84 0.84 0.87 0.85
D. Military interference 1.70 1.70 1.67 1.67
F. Contracts 2.42 2.42 2.42 2.42 2.42 2.42
G. Real property 5.95 5.95 5.95 5.99 5.99 5.99
3. Sound Money 7.07 7.30 7.29
A. Money growth 0.00 (147.38) 0.00 (147.38) 0.00 (147.38) 0.00 (147.38) 0.00 (147.38) 0.00 (147.38)
C. Inflation 9.64 (1.81) 9.65 (1.75) 9.76 (1.18)
A. Tariffs 8.58 8.81 8.81
5. Regulation 6.73 6.73 5.48 4.54 4.20 4.20
A. Credit market regulation
(ii) Private sector credit
(iii) Interest rate controls / negative real interest rates
C. Business regulation 1.68 0.65 0.65
(iv) Tax compliance 0.00 0.00 0.00
(ii) Business permits

South Africa 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 8.24 7.35 7.06 5.81 5.81 5.81 5.81 5.62
G. Real property 5.83 5.95 6.69 7.17 6.94 6.94 6.94
3. Sound Money 5.32 5.87 7.99 8.07 8.22 8.22 8.16 8.16
A. Money growth 8.01 (9.96) 7.02 (14.9) 8.42 (7.9) 8.75 (6.27) 9.26 (3.7) 9.30 (3.5) 8.97 (5.13) 8.97 (5.13)
B. Standard deviation of inflation 8.12 (4.71) 9.49 (1.27) 9.60 (0.99) 9.37 (1.57) 9.54 (1.16) 9.49 (1.27) 9.49 (1.27) 9.60 (1)
C. Inflation 5.18 (24.12) 6.98 (15.09) 8.93 (5.34) 9.15 (4.27) 9.08 (4.59) 9.10 (4.5) 9.18 (4.12) 9.08 (4.61)
A. Tariffs 8.66 7.27 7.74 6.84 7.37 7.28 7.40 7.38
5. Regulation 5.64 5.90 6.94 7.13 7.23 6.56 6.30 6.35
(vi) Conscription 0.00 0.00 10.00 10.00 10.00 10.00 10.00 10.00

Spain 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 1.00 (66) 3.00 (56) 4.00 (48) 6.00 (35-43) 4.00 (46) 5.00 (45) 5.00 (45) 5.00 (47)
(ii) Top marginal income and payroll tax rate 3.00 (56) 4.00 (48) 6.00 (35-43) 4.00 (46) 5.00 (45) 5.00 (45) 5.00 (47)
F. Contracts 6.45 6.69 6.69 5.60 5.17 5.19 5.19 5.19
G. Real property 7.19 7.16 7.29 7.76 7.75 7.75 7.75
3. Sound Money 6.07 6.36 9.44 9.67 9.76 9.40 9.19 9.06
A. Money growth 8.36 (8.21) 7.70 (11.5) 8.66 (6.7) 9.65 (1.73) 9.37 (3.16) 8.13 (9.33) 7.07 (14.65) 7.07 (14.65)
C. Inflation 7.33 (13.35) 8.54 (7.31) 9.31 (3.43) 9.64 (1.8) 9.90 (-0.5) 9.67 (1.68) 9.86 (0.7) 9.38 (3.09)
A. Tariffs 8.22 8.21 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 6.82 7.18 7.26 7.03 7.36 7.53 7.09 7.27
(vi) Conscription 1.00 3.00 3.00 10.00 10.00 10.00 10.00 10.00

Sri Lanka 1980 1990 2000 2010 2015 2019 2020 2021
(i) Top marginal income tax rate 0.00 (60.5) 7.00 (35) 7.00 (35) 9.00 (24) 9.00 (24) 10.00 (18) 10.00 (18)
F. Contracts 2.93 1.81 1.81 1.81 1.81 1.81
G. Real property 6.75 7.13 6.75 7.36 7.59 7.59 7.59
3. Sound Money 4.98 5.59 6.63 6.44 7.99 8.06 6.79 6.57
A. Money growth 5.35 (23.25) 8.43 (7.87) 8.78 (6.12) 8.73 (6.36) 8.54 (7.32) 8.79 (6.07) 8.79 (6.07) 8.79 (6.07)
C. Inflation 6.00 (19.98) 5.94 (20.29) 8.76 (6.18) 8.81 (5.94) 9.82 (0.92) 9.58 (2.13) 9.29 (3.53) 8.60 (7.01)
A. Tariffs 1.97 2.92 7.62 6.48 6.05 5.68 5.27 7.04
5. Regulation 5.50 6.04 6.12 5.99 6.35 6.14 6.10 6.09
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Sudan 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 1.59 1.90 1.90 1.90 1.90 1.90
G. Real property 8.81 8.84 8.94 8.94 8.94 8.94
3. Sound Money 6.84 1.94 1.25 1.25
A. Money growth 5.64 (21.82) 3.79 (31.07) 6.00 (20.02) 8.22 (8.92) 7.25 (13.75) 0.49 (47.56) 0.00 (59.57) 0.00 (59.57)
C. Inflation 6.62 (16.91) 0.00 (63.29) 0.00 (50.99) 0.00 (382.82)
A. Tariffs 5.01 5.01 5.00
5. Regulation 4.45 5.09 4.34 3.94 4.17 4.02

Suriname 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 1.37 1.37 1.38 1.37 1.37 1.37
G. Real property 1.78 1.74 3.49 4.46 4.46 4.46
3. Sound Money 8.83 8.78 7.75 7.22 4.29
A. Money growth 0.00 (152.38) 9.17 (-4.14) 9.28 (3.58) 7.47 (12.65) 6.75 (16.27) 6.75 (16.27)
C. Inflation 8.61 (6.94) 8.62 (6.9) 8.62 (6.9) 9.12 (4.39) 0.00 (59.11)
A. Tariffs 7.47 7.48 7.48 7.48 7.48
5. Regulation 5.61 6.09 6.35 6.46 6.22 6.28
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Sweden 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 0.00 (87) 0.00 (61-68) 2.00 (51-58) 2.00 (52-59) 2.00 (57) 2.00 (57) 2.00 (52) 2.00 (52)
(68.4-
(ii) Top marginal income and payroll tax rate 0.00 (79-86) 0.00
75.4)
0.00 (63-69) 0.00 (67) 0.00 (67) 0.00 (63) 0.00 (63)
F. Contracts 9.12 9.12 8.85 7.41 7.82 7.41 7.41 7.41
G. Real property 8.73 8.98 8.02 8.45 8.45 8.45 8.45
3. Sound Money 7.56 8.03 9.90 9.69 9.85 9.67 9.56 9.54
A. Money growth 8.18 (9.11) 9.44 (2.78) 9.94 (0.29) 9.36 (3.21) 9.59 (2.07) 9.25 (3.73) 8.77 (6.17) 8.77 (6.17)
C. Inflation 7.66 (11.72) 8.23 (8.84) 9.82 (0.9) 9.77 (1.16) 9.99 (-0.05) 9.61 (1.95) 9.64 (1.78) 9.57 (2.16)
A. Tariffs 9.02 8.96 9.18 8.34 8.36 8.20 8.03 8.06
5. Regulation 7.11 7.33 7.77 8.12 8.26 7.75 7.63 7.83
(vi) Conscription 3.00 3.00 3.00 10.00 10.00 5.00 5.00 5.00

Switzerland 1980 1990 2000 2010 2015 2019 2020 2021

C. Government investment 10.00 (13.85) 10.00 (13.77) 10.00 (12.81) 10.00 (13.22) 10.00 (12.66) 10.00 (11.99) 10.00 (13) 10.00 (12)
F. Contracts 8.46 8.46 8.46 7.20 6.95 6.67 6.67 6.67
G. Real property 9.24 9.57 9.57 9.60 9.60 9.60 9.60
3. Sound Money 9.52 9.60 9.87 9.73 9.76 9.85 9.88 9.85
A. Money growth 9.07 (4.66) 9.47 (2.66) 9.97 (0.13) 9.43 (2.86) 9.42 (2.9) 9.75 (1.24) 9.75 (1.24) 9.75 (1.24)
C. Inflation 9.46 (2.71) 9.15 (4.27) 9.69 (1.54) 9.86 (0.7) 9.77 (-1.14) 9.81 (0.94) 9.93 (0.36) 9.88 (0.58)
A. Tariffs 8.74 9.28 9.92 6.29 6.19 6.24 6.43 6.26
(ii) Mean tariff rate 9.08 (4.6) 9.12 (4.4) 10.00 (0) 8.96 (5.2) 8.66 (6.7) 8.80 (6) 8.94 (5.3) 8.88 (5.6)
5. Regulation 6.93 7.72 8.11 8.31 8.25 8.00 7.84 7.97
(vi) Conscription 3.00 3.00 5.00 5.00 5.00 0.00 0.00 0.00

Syrian Arab Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 1.66 1.61 1.61 1.61 1.61 1.61
G. Real property 4.49 4.36 4.64 4.09 4.09 4.09 4.09
H. Police and crime 2.18 2.18 2.18 2.18 2.18
3. Sound Money 8.17 5.49 6.39 7.14 4.81 8.00 6.28 4.81
A. Money growth 7.62 (11.9) 7.09 (14.55) 8.86 (5.69) 8.48 (7.58) 9.25 (3.74) 9.25 (3.74) 9.25 (3.74) 9.25 (3.74)
C. Inflation 6.51 (17.47) 6.13 (19.33) 9.23 (-3.85) 9.12 (4.4) 0.00 (80) 8.30 (8.52) 0.00 (75) 0.00 (98.33)
A. Tariffs 3.90 4.66 5.17 6.24 5.23 5.23 5.23 7.01
5. Regulation 1.51 1.90 3.92 5.08 3.87 3.80 3.92 3.47
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(ii) Business permits 8.31

Taiwan 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 10.00 (0.35) 9.87 (0.99) 9.21 (3.4) 9.32 (3) 9.27 (3.17) 9.29 (3.12) 9.18 (3.52) 9.14 (3.66)
F. Contracts 7.68 7.39 7.39 6.60 6.68 6.67 6.67 6.67
G. Real property 7.87 7.87 7.87 7.89 7.89 7.89 7.89
3. Sound Money 8.05 9.42 9.46 9.63 9.63 9.70 9.69 9.56
A. Money growth 8.24 (8.79) 9.18 (4.09) 9.50 (-2.52) 9.27 (3.65) 9.49 (2.55) 9.74 (1.29) 9.31 (3.47) 9.31 (3.47)
C. Inflation 6.20 (19) 9.18 (4.1) 9.27 (3.67) 9.81 (0.97) 9.94 (-0.3) 9.72 (1.4) 9.89 (0.56) 9.61 (1.96)
A. Tariffs 7.60 8.33 7.98 7.72 7.66 7.25 7.58 7.21
(ii) Capital controls 2.00 5.00
5. Regulation 4.79 6.42 6.11 7.12 7.41 7.88 7.67 7.69
(vi) Conscription 0.00 0.00 0.00 3.00 5.00 10.00 5.00 5.00

Tajikistan 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.50 2.84 2.84 2.84 2.84 2.84
G. Real property 8.71 7.79 8.41 8.46 8.46 8.46
3. Sound Money 7.49 7.85 9.14 9.19 9.06
A. Money growth 0.00 (157.38) 9.74 (-1.31) 9.74 (-1.31) 8.18 (9.12) 8.78 (6.09) 8.78 (6.09)
C. Inflation 8.72 (6.42) 8.86 (5.71) 9.24 (3.8) 8.44 (7.79) 8.26 (8.71)
A. Tariffs 8.38 8.50 8.44 8.44 8.29
(ii) Mean tariff rate 8.44 (7.8) 8.48 (7.6) 8.46 (7.7) 8.46 (7.7) 8.40 (8)
5. Regulation 5.04 5.96 5.98 6.21 6.25 6.21
(vi) Conscription 0.00 0.00 0.00 0.00 0.00

Tanzania 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 10.00 (0) 8.05 (7.64) 8.07 (7.58) 7.99 (7.86) 7.99 (7.86) 7.99 (7.86)
F. Contracts 4.50 4.31 4.11 4.11 4.11 4.11
G. Real property 6.11 4.84 7.17 7.29 7.02 7.02 7.02
3. Sound Money 3.50 4.78 7.49 7.81 7.97 8.37 8.34 8.38
A. Money growth 8.30 (8.49) 7.92 (10.4) 9.02 (4.91) 9.82 (-0.9) 10.00 (0) 10.00 (0)
C. Inflation 3.96 (30.2) 5.64 (21.82) 8.82 (5.92) 8.76 (6.2) 8.88 (5.59) 9.30 (3.49) 9.31 (3.45) 9.26 (3.69)
A. Tariffs 4.87 4.53 4.96 7.14 7.11 6.78 6.78 6.80
5. Regulation 3.18 4.43 5.21 6.34 6.71 6.50 6.49 6.53
(vi) Conscription 10.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00

Thailand 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.57 5.82 5.82 5.54 5.40 5.17 5.17 5.17
G. Real property 7.89 7.89 9.60 7.45 7.46 7.46 7.46
3. Sound Money 6.16 7.79 6.74 7.10 8.41 8.57 9.79 9.76
A. Money growth 8.32 (8.42) 7.96 (10.18) 9.23 (3.87) 9.50 (2.52) 9.43 (2.87) 9.81 (0.94) 9.81 (0.94) 9.81 (0.94)
C. Inflation 7.46 (12.7) 8.85 (5.77) 9.69 (1.57) 9.34 (3.31) 9.82 (-0.9) 9.79 (1.06) 9.86 (0.71) 9.75 (1.23)
A. Tariffs 4.47 3.21 6.65 7.43 6.95 7.14 7.13 6.89
(ii) Mean tariff rate 3.54 (32.3) 1.84 (40.8) 6.60 (17) 8.02 (9.9) 7.80 (11) 7.96 (10.2) 7.96 (10.2) 7.70 (11.5)
5. Regulation 4.88 6.09 6.82 7.15 7.00 6.78 5.97 6.63
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Timor-Leste 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 0.00 0.00 0.00 0.00 0.00 0.00
G. Real property 5.37 5.37 5.37 5.37 5.37 5.37
3. Sound Money 8.61 9.00 8.63 8.30 7.22
A. Money growth 0.00 (160.38) 7.11 (14.47) 8.84 (5.82) 9.62 (1.88) 9.62 (1.88) 9.62 (1.88)
C. Inflation 8.65 (6.77) 9.87 (0.63) 9.47 (2.64) 9.81 (0.96) 9.25 (3.77)
A. Tariffs 9.56 9.65 9.65 9.60
(iii) Standard deviation of tariff rates 10.00 (0) 10.00 (0) 10.00 (0) 9.84 (0.4)
5. Regulation 4.64 6.79 6.83 5.56 5.91 5.15
(iii) Flexible wage determination 5.57 5.75
(vi) Conscription 10.00 10.00 10.00 10.00 10.00

Togo 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.98 4.07 4.45 4.45 4.45 4.45
G. Real property 0.43 3.53 0.69 1.98 8.81 8.81 8.81
3. Sound Money 5.48 7.09 6.60 6.61 6.82 7.20 7.23 7.07
A. Money growth 8.45 (7.73) 9.58 (-2.09) 9.11 (4.45) 7.98 (10.12) 8.72 (6.41) 9.50 (2.52) 9.46 (2.68) 9.46 (2.68)
C. Inflation 7.91 (10.47) 9.40 (2.98) 9.62 (1.89) 9.63 (1.83) 9.64 (1.79) 9.81 (0.93) 9.86 (0.69) 9.14 (4.32)
A. Tariffs 1.73 3.87 7.60 7.38 7.20 7.06 7.06 7.06
5. Regulation 6.56 6.92 4.29 4.36 5.79 5.92 6.19 6.43
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Trinidad and Tobago 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 1.48 1.48 1.48 1.48 1.48 1.48
G. Real property 4.64 4.64 6.24 6.24 6.24 6.24
3. Sound Money 4.52 5.99 9.07 8.28 8.44 9.25 9.50 9.01
A. Money growth 7.69 (11.56) 9.26 (3.72) 8.98 (5.12) 9.10 (4.5) 8.84 (5.78) 9.63 (1.87) 9.38 (3.11) 9.38 (3.11)
C. Inflation 4.49 (27.53) 6.90 (15.49) 9.29 (3.56) 7.89 (10.55) 9.07 (4.66) 9.80 (1.02) 9.80 (1) 9.59 (2.06)
A. Tariffs 7.87 6.12 5.40 7.64 7.52 7.52 7.52 6.79
5. Regulation 6.70 6.87 7.34 6.99 6.19 6.39 6.36 6.00
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Tunisia 1980 1990 2000 2010 2015 2019 2020 2021

(i) Top marginal income tax rate 2.00 (62.3) 7.00 (35) 7.00 (35) 5.00 (36) 5.00 (36) 5.00 (36)
(ii) Top marginal income and payroll tax rate 4.00 (50.65) 4.00 (44) 2.00 (53) 2.00 (53) 2.00 (53)
F. Contracts 7.14 4.94 4.94 4.94 4.94 4.94
G. Real property 7.11 6.92 7.26 7.26 7.33 7.33 7.33
3. Sound Money 6.16 6.68 6.97 6.83 7.03 6.68 7.96 7.99
A. Money growth 8.59 (7.06) 8.42 (7.91) 8.72 (6.42) 8.78 (6.12) 9.41 (2.97) 8.78 (6.09) 8.54 (7.31) 8.54 (7.31)
B. Standard deviation of inflation 8.63 (3.43) 9.20 (2) 9.75 (0.62) 9.44 (1.41) 9.67 (0.83) 9.41 (1.47) 9.64 (0.89) 9.56 (1.11)
C. Inflation 7.44 (12.8) 9.10 (4.48) 9.41 (2.93) 9.12 (4.42) 9.03 (4.86) 8.54 (7.31) 8.66 (6.72) 8.86 (5.71)
A. Tariffs 4.36 4.71 5.53 6.91 6.97 7.26 7.26 7.26
5. Regulation 5.52 4.89 5.55 6.51 6.13 5.82 5.83 5.77
(vi) Conscription 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Türkiye 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.17 4.91 4.91 4.47 3.86 3.84 3.84 3.84
G. Real property 8.90 8.78 8.90 8.55 8.93 8.93 8.93
3. Sound Money 0.74 3.73 3.57 8.80 9.08 8.20 8.12 7.54
A. Money growth 2.98 (35.1) 1.83 (40.85) 0.00 (89.33) 8.11 (9.44) 8.29 (8.54) 7.61 (11.95) 6.86 (15.7) 6.86 (15.7)
C. Inflation 0.00 (85.04) 0.00 (58.21) 0.00 (54.92) 8.29 (8.57) 8.47 (7.67) 6.73 (16.33) 6.96 (15.18) 6.08 (19.6)
A. Tariffs 3.50 4.53 7.42 6.25 6.00 6.24 6.00 6.13
(ii) Mean tariff rate 1.20 (44) 5.46 (22.7) 8.58 (7.1) 8.02 (9.9) 7.84 (10.8) 8.00 (10) 7.78 (11.1) 7.86 (10.7)
5. Regulation 3.50 4.86 5.47 5.94 6.27 5.58 5.63 5.71
(vi) Conscription 0.00 1.00 1.00 1.00 1.00 5.00 5.00 5.00

Uganda 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 5.02 3.20 3.69 3.68 3.68 3.68
G. Real property 6.93 7.42 7.39 8.35 7.92 7.92 7.92
3. Sound Money 0.00 0.37 9.19 8.62 8.59 9.46 9.37 9.40
A. Money growth 8.29 (8.55) 6.96 (15.2) 9.01 (4.93) 9.00 (4.99) 8.70 (6.52) 8.70 (6.52)
C. Inflation 1.12 (44.38) 9.43 (2.83) 9.20 (3.98) 8.95 (5.23) 9.48 (2.62) 9.43 (2.87) 9.56 (2.2)
A. Tariffs 7.93 3.39 5.43 7.14 6.91 6.50 6.54 4.79
5. Regulation 2.35 4.89 6.15 7.11 7.24 6.91 6.77 6.32
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Ukraine 1980 1990 2000 2010 2015 2019 2020 2021

(ii) Top marginal income and payroll tax rate 4.00 (43.6) 5.00 (40) 4.00 (45) 7.00 (34) 7.00 (34) 7.00 (34)
F. Contracts 4.26 4.26 4.26 3.28 2.93 2.85 2.85 2.85
G. Real property 6.83 6.99 7.39 8.94 9.16 9.16 9.16
3. Sound Money 2.21 5.62 3.29 6.69 7.21 6.96
A. Money growth 3.05 (34.74) 7.05 (14.74) 8.20 (8.99) 8.48 (7.58) 7.66 (11.72) 7.66 (11.72)
C. Inflation 4.36 (28.2) 8.12 (9.38) 0.26 (48.72) 7.81 (10.95) 8.42 (7.89) 8.13 (9.36)
A. Tariffs 7.62 8.62 8.60 8.82 8.82 8.85
5. Regulation 4.71 5.06 5.64 5.86 5.43 5.36
(vi) Conscription 1.00 0.00 0.00 0.00 0.00 0.00

United Arab Emirates 1980 1990 2000 2010 2015 2019 2020 2021
(i) Top marginal income tax rate 10.00 (0) 10.00 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
F. Contracts 4.93 5.17 5.42 5.42 5.42 5.64
G. Real property 9.30 9.17 9.30 9.91 9.91 9.91 9.91
3. Sound Money 8.75 9.49 7.80 8.30 8.61 9.03 9.08 8.99
A. Money growth 9.47 (2.66) 9.07 (4.65) 8.14 (9.3) 9.17 (4.14) 9.94 (0.28) 9.66 (1.7) 9.66 (1.7)
C. Inflation 8.18 (9.1) 9.18 (4.1) 5.63 (21.83) 9.82 (0.88) 9.19 (4.07) 9.39 (3.07) 9.61 (-1.93) 10.00 (-0.01)
A. Tariffs 10.00 10.00 9.60 8.67 8.74 8.43 9.00 8.49
(i) Trade tax revenue 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0) 10.00 (0)
5. Regulation 6.15 6.55 6.87 8.02 8.03 7.42 7.44 7.47
(vi) Conscription 3.00 10.00 10.00 10.00 0.00 0.00 0.00 0.00

United Kingdom 1980 1990 2000 2010 2015 2019 2020 2021
C. Government investment 10.00 (11.56) 10.00 (12.37) 10.00 (8.89) 8.39 (20.62) 9.83 (15.6) 9.85 (15.52) 9.25 (17.64) 9.14 (18)
F. Contracts 7.39 7.83 7.83 7.18 6.67 6.55 6.55 6.55
G. Real property 8.26 8.26 8.50 8.02 8.02 8.02 8.02
3. Sound Money 5.86 8.48 9.30 9.47 9.90 9.68 9.57 9.49
A. Money growth 8.18 (9.09) 5.76 (21.19) 8.10 (9.51) 8.80 (6) 9.92 (-0.41) 9.46 (2.68) 9.21 (3.94) 9.21 (3.94)
C. Inflation 6.23 (18.84) 8.72 (6.42) 9.41 (2.93) 9.34 (3.29) 9.99 (0.05) 9.54 (2.29) 9.65 (1.74) 9.50 (2.52)
A. Tariffs 8.89 8.41 9.18 8.34 8.36 8.20 8.03 8.70
5. Regulation 7.62 8.68 8.80 7.93 8.21 8.25 7.58 7.75
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

United States 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 8.96 8.96 8.96 8.36 7.82 7.84 7.84 7.84
G. Real property 9.61 9.61 9.61 8.92 8.92 8.92 8.92
3. Sound Money 9.12 9.67 9.61 9.68 9.86 9.72 9.60 9.38
A. Money growth 8.85 (5.75) 9.84 (0.82) 9.27 (3.67) 9.49 (2.56) 9.58 (2.09) 9.57 (2.13) 8.96 (5.2) 8.96 (5.2)
C. Inflation 8.10 (9.51) 9.13 (4.34) 9.32 (3.38) 9.67 (1.64) 9.98 (0.12) 9.51 (2.44) 9.64 (1.81) 9.06 (4.7)
A. Tariffs 8.90 8.23 8.12 8.43 8.38 8.32 8.29 8.26
(ii) Mean tariff rate 8.54 (7.3) 8.76 (6.2) 9.20 (4) 9.30 (3.5) 9.30 (3.5) 9.34 (3.3) 9.32 (3.4) 9.32 (3.4)
5. Regulation 8.66 8.86 9.09 8.45 8.89 8.72 8.28 8.29
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Uruguay 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.36 3.19 3.05 3.05 3.05 3.05
G. Real property 6.42 6.42 6.42 6.45 6.45 6.45 6.45
3. Sound Money 3.82 3.76 8.15 9.24 9.01 9.23 8.89 8.86
A. Money growth 0.00 (59.01) 0.00 (66.03) 7.52 (12.39) 8.93 (5.37) 8.08 (9.58) 9.18 (4.12) 8.16 (9.18) 8.16 (9.18)
C. Inflation 0.00 (54.76) 0.00 (100.39) 9.05 (4.76) 8.66 (6.68) 8.27 (8.67) 8.48 (7.61) 8.42 (7.88) 8.45 (7.75)
A. Tariffs 4.07 5.94 7.72 7.77 7.72 7.81 7.81 7.80
5. Regulation 3.31 8.44 6.51 6.63 6.54 6.89 6.76 6.66
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Venezuela, RB 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.42 3.09 2.87 2.41 1.74 1.63 1.63 1.63
G. Real property 8.65 8.69 8.39 8.13 8.14 8.14 8.14
3. Sound Money 7.44 4.09 5.64 3.57 0.94 0.94 0.94 0.94
A. Money growth 7.95 (10.27) 4.71 (26.43) 5.79 (21.06) 6.27 (18.66) 3.78 (31.1) 3.78 (31.1) 3.78 (31.1) 3.78 (31.1)
B. Standard deviation of inflation 7.02 (7.44) 0.00 (30.17) 0.00 (39.23) 3.81 (15.48) 0.00 (39.37) 0.00 (53612) 0.00 (53319.32) 0.00 (53197.98)
C. Inflation 4.80 (26.02) 1.66 (41.71) 6.76 (16.21) 4.19 (29.06) 0.00 (121.74) 0.00 (65374.1) 0.00 (19906.02) 0.00 (1588.51)
A. Tariffs 8.00 4.22 7.61 7.80 7.57 7.26 7.26 7.26
5. Regulation 5.01 5.06 4.65 3.70 2.71 2.05 2.03 2.17
(v) Costs of worker dismissal 0.00
(vi) Conscription 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Vietnam 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 3.03 3.93 3.93 4.09 4.15 4.23 4.23 4.23
G. Real property 6.99 8.34 8.56 8.72 8.79 8.79 8.79
3. Sound Money 5.54 6.14 6.86 6.96 7.02
A. Money growth 5.70 (21.49) 6.48 (17.61) 7.96 (10.2) 8.82 (5.9) 8.92 (5.38) 8.92 (5.38)
C. Inflation 8.23 (8.86) 9.87 (0.63) 9.29 (3.53) 9.44 (2.8) 9.63 (1.83)
A. Tariffs 8.18 7.25 6.53 7.60 7.66 7.61
5. Regulation 3.59 5.92 6.05 6.10 6.08 6.10
(vi) Conscription 0.00 0.00 0.00 0.00 0.00

Yemin, Republic 1980 1990 2000 2010 2015 2019 2020 2021
F. Contracts 3.56 2.77 1.89 1.89 1.89 1.89
G. Real property 8.32 8.39 9.05 9.05 9.05 9.05
H. Police and crime 0.89 1.02 1.71 1.71 1.71
3. Sound Money 7.93 8.07 6.90 6.37 2.48
A. Money growth 0.00 (173.38) 9.11 (-4.44) 9.93 (-0.34) 9.93 (-0.34) 9.93 (-0.34) 9.93 (-0.34)
B. Standard deviation of inflation 4.85 (12.89) 7.14 (7.14) 3.20 (17) 7.53 (6.17) 0.00 (213.65)
C. Inflation 7.77 (11.17) 5.22 (23.91) 4.48 (27.6) 8.00 (10) 0.00 (63.77)
A. Tariffs 8.55 8.43 8.40 8.40 8.40
5. Regulation 6.49 5.61 5.26 4.69 3.10 3.17 3.08
(vi) Conscription 0.00 10.00 10.00 10.00 10.00
(ii) Business permits 8.92 7.92

Zambia 1980 1990 2000 2010 2015 2019 2020 2021

F. Contracts 4.58 3.53 3.01 3.00 3.00 3.00
G. Real property 5.49 5.52 7.09 5.90 6.03 6.03 6.03
3. Sound Money 6.14 0.45 6.90 8.87 8.63 9.11 8.49 7.33
A. Money growth 8.72 (6.42) 1.38 (43.09) 4.46 (27.7) 7.69 (11.53) 7.76 (11.22) 9.14 (4.32) 6.95 (15.24) 6.95 (15.24)
C. Inflation 7.65 (11.76) 0.00 (106.39) 4.79 (26.03) 8.30 (8.5) 7.98 (10.1) 8.50 (7.49) 8.17 (9.15) 5.60 (22.02)
A. Tariffs 8.40 5.84 6.22 7.27 5.94 7.18 7.27 7.11
5. Regulation 5.05 4.23 4.62 5.15 5.26 4.82 4.70 4.89
(vi) Conscription 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00

Zimbabwe 1980 1990 2000 2010 2015 2019 2020 2021

B. Transfers and subsidies 7.03 (11.4) 8.45 (6.2) 7.75 (8.77) 9.84 (1.07) 9.40 (2.72) 8.50 (6) 8.50 (6) 8.50 (6)
F. Contracts 3.33 2.72 1.19 1.19 1.19 1.37
G. Real property 4.43 4.43 6.09 6.82 7.05 7.05 7.05
3. Sound Money 5.81 6.09 4.16 4.14 7.91 5.55 1.25 1.25
A. Money growth 8.94 (-5.32) 8.98 (-5.11) 8.67 (-6.66) 8.30 (8.51) 0.66 (46.71) 0.00 (104.26) 0.00 (104.26)
C. Inflation 8.69 (6.57) 7.05 (14.75) 0.00 (55.86) 7.89 (10.56) 9.52 (-2.4) 7.88 (10.6) 0.00 (255.29) 0.00 (98.55)
A. Tariffs 8.43 5.71 4.56 3.67 5.54 5.14 4.66 5.00
5. Regulation 4.75 5.15 4.58 3.34 5.42 4.75 4.75 4.54
(vi) Conscription 1.00 3.00 10.00 10.00 10.00 10.00 10.00 10.00

Chapter 3 Populism, Majority Rule,
and Economic Freedom
1 Introduction
The past decade has provided vivid testimony to the rise of political populism.
Contrary to earlier populist episodes, the phenomenon was not limited to its
traditional field of Latin America, but has now firmly established itself as a sig-
nificant political force in practically all high-income democracies of Western
Europe and North America. Although research is only beginning to understand
the consequences of its rise to power, an important recent assessment by Funke,
Schularick and Trebesch (2023) suggests that the economic and institutional
costs of populism in government are potentially high. In the United States, for
example, there is already an ongoing discussion of what a possible return of
Donald Trump to the presidency in 2025 would mean for the country’s political
and economic freedoms.
Overall, the rise of populist politicians and their party movements into posi-
tions of government responsibility have sparked a fair amount of research on its
determinants in recent years. Here, a series of influential studies has found that
economic globalization in general, and trade with the People’s Republic of China
in particular, as well as the ensuing effects for inequality and economic insecurity,
may all have functioned as important drivers of the populist rise (Autor, Dorn,
Hanson, and Majlesi, 2020; Gozor, 2022). In this context, other authors have
further highlighted the role of immigration, identity politics, and international
institutions (Guiso, Herrera, Morelli, and Sonno, 2019; Guriev and Papaioannou,
2022). Recently, Bergh and Kärnä (2020, 2022) make the important observa-
tion, though, that many studies finding globalization and inequality to be drivers
of the recent populist success are mostly conducted at the micro-level. At the
cross-country macro-level, these authors find no such association.
Citation Andrea Celico and Martin Rode, Populism, Majority Rule, and Economic Freedom. In James
Gwartney, Robert Lawson, and Ryan Murphy, Economic Freedom of the World: 2023 Annual
Report (Fraser Institute, 2023): 189–206.
Authors Andrea Celico is a Ph.D. candidate in Economics at the University of Navarre, Spain. Martin
Rode is an Associate Professor in the Department of Economics at the University of Navarra in
Pamplona, Spain.

In contrast to the vast number of studies on the determinants of populism,

and partially due to the (still) rather limited number of available observations,
there are not too many comparative empirical studies that have looked at the
economic and institutional outcomes produced by populist governance. Still,
despite their limited coverage, these studies find that, overall, populism in gov-
ernment produces undesirable consequences for the economy and the institu-
tional arrangement of affected countries (Huber and Schimpf , 2017; Absher,
Grier, and Grier, 2020; Bennett, Boudreaux, and Nikolaev, 2021, 2023; Funke,
Schularick and Trebesch, 2023; Strobl, de Viteri, Rode, and Bjørnskov, 2023),
suggesting that we may have reason to be concerned about the rise of populism
into positions of power, if the preservation of liberty and creation of wealth is our
concern. Regarding economic freedom, the only paper that explicitly deals with
the effects of populism on economic freedom is a relatively early contribution
by Rode and Revuelta (2015). Along the lines outlined above, these authors find
empirical evidence that populism and economic freedom are essentially incom-
patible, as populist leaders tend to advocate for policies that restrict economic
freedom, such as protectionism, an overly expansionary monetary policy, and
higher government spending.
Notwithstanding, the study by Rode and Revuelta (2015) does not reflect the
most recent populist episode that is mainly right-wing in nature, focusing instead
extensively on the left-wing populist regimes of Latin America. Furthermore, it
was conducted at a time when the measurement of populism was much more
underdeveloped than at present. In a parallel manner, authors such as Weyland
(1999) have in the past argued that especially right-wing populism and “neolib-
eralism” can coexist, essentially making the argument that populist movements
may promote economic freedom by challenging established elites and corrup-
tion, thereby putting a check on crony capitalism. So, despite the vivid example
of Donald Trump’s war against free trade, and the dismal record on rule of law
that many populist governments on the right present, there is a remote possibility
that the most recent episode of right-wing populism may have produced different
outcomes for economic freedom. These could be similar to the effects identified
by Stöckl and Rode (2021) for financial markets, where these authors find that the
negative effects stemming from the election of populist parties is primarily driven
by populism on the political left.
Another related issue that has come up is the possibility that the relation-
ship between populism in government and economic freedom may be signifi-
cantly conditioned by a country’s political institutions. For example, some
scholars suggest that populist movements in countries with strong checks and
balances may be less likely to restrict economic freedom, as these institutions
provide a limit on executive power (cf. Levitsky and Ziblatt, 2018; Bennett,
Boudreaux, and Nikolaev, 2021, 2023). Here, an instructive example is the
case of Switzerland, which has championed one of Europe’s most successful
right-wing populist parties since the mid-1990s. Because of the Swiss system
of forming executives, the Swiss People’s Party (SVP) has also participated in
numerous governments since that time, but with no apparent negative effect
for the country’s overall economic freedom ratings. These have remained stable
and comparatively high ever since. In part, this may well be due to Switzerland’s
complex system of checks and balances, which heavily constrains the power of
the federal government in Bern.

Chapter 3: Populism, Majority Rule, and Economic Freedom • 191
Following Rode and Revuelta (2015), this chapter reinvestigates the associa-
tion of government populism and economic freedom, considering the potentially
mediating roles of institutional constraints and government ideology. It does so by
employing a recent measure of populism by Celico, Rode, and Rodriguez Carreño
(2022) that offers a much larger time and country coverage than other compara-
ble indicators. Controlling for a series of other determinants, findings show that
populism in government is significantly associated with reductions in economic
freedom for a large sample of democratic countries, where OECD countries are,
nonetheless, differently affected by populism in government than non-OECD
countries. For OECD countries, the association of populism and economic free-
dom seems to be mediated by political constraints and political ideology to a sub-
stantial degree. In contrast, populism in non-OECD countries is generally harmful
for economic freedom, and it is not mediated by political constraints and ideology
in a significant manner. The heterogeneity of our findings is probably the result
of the important institutional guardrails that most OECD countries have in place,
which put an important check on the power of populist governments, and that
are often absent in many non-OECD countries.
2 What is populism: conceptualization and measurement

The concept of populism is arguably one of the most elusive that social science
currently has to offer. Everyone seems to have an idea of which parties and pol-
iticians are populist, but the term has been applied to such a broad spectrum of
actors that it is often not clear what similarities would justify such a categoriza-
tion, outside that of personal ideological preferences. The economics literature,
for example, has often equated populism with regimes employing radical left-of-
center economic policies that eventually threaten the stability of the regime itself
(Dornbusch and Edwards, 1991; Acemoglu, Egorov, and Sonin, 2013). This view
of populism has often been criticized, because it places redistributive objectives
at the center of its definition, thus focusing almost exclusively on left-wing pop-
ulist regimes in Latin America (Hawkins, 2009).
An approach that also encompasses the more recent rise of populism on the
right is the ideational definition, which focuses on the dualistic worldview of pop-
ulism that sees “the people” engulfed in a cosmic struggle with “the elites” that have
somehow managed to subvert the will of the people (Müller, 2017; Mudde and
Rovira Kaltwasser, 2017). This definition thus focuses on the tendency of all populist
movements to identify democracy with a certain party or leader who defends the
people’s interests against those of a privileged elite, essentially making it an ideolog-
ical worldview on the functioning of politics. To have the will of the people prevail,
some kind of revolution is needed and, as a consequence, populists tend to identify
the minority rights of liberal democracy as unjustly protecting the conspiring elites,
frequently calling for their abolition (Hawkins, 2009). This type of discourse or pol-
icy style is independent of political ideology and can be found both on the politi-
cal right, and on the left, which usually act as a type of host-ideology (Mudde and
Rovira Kaltwasser, 2017). In the case of left-wing populism, the conspiring elite is
mostly the “neoliberal” business establishment, while in the case of right-wing pop-
ulism, it is the “liberal” cultural elite that undermines national identity and culture.
While this distinction is important for the definition of populist ideology, it should
also be mentioned here that right-wing populists often attack business elites as well.

Practically all attempts to quantify the populism of parties and politicians are
based on some version of this ideational definition, which is also the one we will
stick to in the following. Existing indicators of populism can generally be divided
between demand-side and supply-side measures. The former attempts to capture
the populist political attitudes of voters, while the latter tries to quantify the degree
of populism employed by political leaders and parties. Overall, the development of
supply-side measures is currently much more advanced than that of demand-side
measures. Since our own objective is to capture government populism in some
form, we only focus on the political supply-side for the purposes of this chapter.
Capturing supply-side populism

Several measurement approaches to capturing supply-side populism can be distin-
guished in the academic literature. First, an initial set of attempts mainly used dis-
course analysis to measure the degree of populist rhetoric employed by political
leaders. For instance, Hawkins (2009) developed an early dataset that is based on
the textual analysis of political speeches of 215 chief executives from 66 countries.
Unfortunately, the coverage of these indicators is usually quite limited. Second,
other authors have developed binary or categorical populism measures, such as
the PopuList (Rooduijn et al., 2019) and the Timbro Authoritarian Populism Index
(Heinö, 2016). Although these offer wide temporal and geographic coverage, cri-
tiques have pointed to the fact that the multidimensional complexity of popu-
lism can hardly be explained sufficiently by a zero-one dynamic (Hawkins, 2009).
Third, most recently a series of datasets employ surveys of academic experts to
qualify the degree of populism employed by political parties for a wide set of dif-
ferent parties and countries (Norris, 2020; Meijers and Zaslove, 2021). Despite
the precise definitions and methodological consistency offered by these indica-
tors, these are only available for rather short periods of time.
In this chapter, we employ a populism indicator by Celico, Rode, and
Rodriguez Carreño (2022) that employs machine-learning tools to greatly extend
the temporal coverage of the measure by Meijers and Zaslove (2021), combining
different expert surveys via random forest-regression algorithms. The resulting
indicator captures party-level populism on a continuous 0-to-10 scale, covering
1,920 parties in 163 countries from 1970 to 2019. Zero represents pluralist par-
ties, while 10 represents populist parties. Since their underlying base data is avail-
able for all countries with a national legislature, Celico, Rode, and Rodriguez
Carreño (2022) are able to calculate populism scores for countries in democratic
and autocratic countries. It may, in principle, be somewhat a matter for discus-
sion how much the phenomenon of populism is applicable to non-democratic
settings. Still, many authors have successfully applied the concept to autocracies
in past research (e.g., Mudde and Rovira Kaltwasser, 2017; Funke, Schularick and
Trebesch, 2023) and autocratic leaders like Vladimir Putin are vividly demonstrat-
ing at present what autocratic populism essentially looks like. In the following, we
employ the data for democratic and autocratic countries for illustrative purposes
but limit our empirical analysis to electoral democracies only.
Figurze 3.1 shows the ten most populist parties between 2010 and 2019, which
we show separately for OECD and non-OECD countries.1 Focusing first on the
1 Populist parties in OECD countries: PVV = Party for Freedom; LsNS = People’s Party Our Slovakia;
AfD=Alternative for Germany; PiS = Law and Justice; SPD= Freedom and Direct Democracy;

Figure 3.1: The ten most populist parties in OECD and non-OECD countries, 2010–2019
PVV (Netherlands) EFF (South Africa)

LsNS (Slovakia) AN (Mongolia)
AfD (Germany) PSUV (Venezuela)
PiS (Poland) Keadilan (Malaysia)
SPD (Czech Republic PDP-Laban (Philippines)
Fidesz (Hungary) PTI (Pakistan)
FPO (Austria) FL (Haiti)
FN (France) UFDG (Guinea)
SDS (Slovenia) RJPN (Nepal)
M5S (Italy) Semilla (Guatemala)
0.0 2.5 5.0 7.5 0.0 2.5 5.0 7.5
Populism levels—OECD countries Populism levels—non-OECD countries
Source: Random Forest Populism Indicators (Celico, Rode, and Rodriguez Carreño, 2022).
left-hand panel for OECD countries, the list contains some very obvious candi-
dates, such as the Dutch Party for Freedom (PVV) under its flamboyant leader
Geert Wilders, the Italian Five Star Movement (M5S) founded by comedian
Beppe Grillo, or the Alternative for Germany (Af D) that has recently made
headlines with its openly revisionist rhetoric concerning Germany’s WWII past.
Similarly, the Polish Law and Justice Party (PiS), as well as the Hungarian Fidesz
party under the leadership of Victor Orban, both of which have gone about dis-
mantling their respective country’s system of democratic checks and balances in
recent years, figure prominently in this list. In the right-hand panel of figure 3.1,
we also find many well-known populist parties in non-OECD countries, such as
Julius Malema’s Economic Freedom Fighters (EFF) in South Africa, the United
Socialist Party of Venezuela (PSUV), founded by former president Hugo Chavez
and currently led by the present chief executive Nicolas Maduro, as well as the
Philippine Democratic Party–Strength of the People (PDP-Laban), which is
chaired by the country’s former populist president, Rodrigo Duterte.
Aggregating the party-level populism indicator of Celico, Rode, and
Rodriguez Carreño (2022) to the country level is not straightforward. We opt for
an approach that considers both the degree of populism presented by a respec-
tive party and its relative strength inside a government coalition, similar to the
approach taken by Stöckl and Rode (2021). In so doing, we create a measure
that is the parliamentary-seat-share weighted degree of populism for all parties
that make up a government coalition, employing data provided by the V-Party
dataset by Lührmann and colleagues (2022). Of course, this may be a somewhat
imperfect proxy for presidential systems of government, where, for example, the
chief executive is populist, but whose party does not necessarily enjoy a parlia-
mentary majority. Notwithstanding, these cases should be few. Figure 3.2 shows
Fidesz = Fidesz – Hungarian Civic Alliance; FPO = Freedom Party of Austria; FN = National Rally;
SDS = Slovenian Democratic Party; M5S = Five Star Movement. Populist parties in non-OECD
countries: EFF = Economic Freedom Fighters; AN = Democratic Party; PSUV = United Socialist
Party of Venezuela; Keadilan = People’s Justice Party; PDP-Laban = Philippine Democratic Party-
Strength of the People; PTI = Pakistan Movement for Justice; FL = Lavalas Family; UFDG = Union
of Democratic Forces of Guinea; RJPN = National People’s Party, Nepal; Semilla = Seed Movement.

Figure 3.2: The distribution of government populism worldwide (last available election)
Low
Average
High
Note: Displayed categories are based on populism in government terciles.

Source: Celico, Rode, and Rodriguez Carreño, 2022; Lührmann et al., 2022; authors’ calculations.
the distribution of government populism worldwide, always employing the latest

election available. A brief visual inspection shows that many recent episodes of
populism in government are quite adequately represented, such as the cases of
Italy, Poland, Hungary, Turkey, Venezuela, Mexico, or India. Despite the recent
advances of political populism in many Western high-income countries, the figure
nonetheless also makes clear to what a large extent the phenomenon is centered
on non-Western middle- and low-income countries, extending nowadays also far
beyond the limits of Latin America.
Figure 3.3 shows the evolution of average government populism from 1970 to
2019, where scores are normalized on the value of 1970. It can be seen here that
overall populism was comparatively low during the 1980s and 1990s, which were
also two decades characterized by considerably less political polarization than
others during the twentieth century. It is clearly visible that populism in gov-
ernment has been on the rise again since the early 2000s though, reflecting what
Mudde (2004) has prominently called the “populist zeitgeist”. Interestingly, this
development started long before most other observers seemed to take notice. The
figure also clearly shows the last sharp increase in government populism during
the 2010s, when the topic first rose to a certain prominence with the larger pub-
lic, following the success of new populist politicians and parties in the aftermath
of the Great Recession.
3 Economic freedom, populism, ideology, and political constraints

In the following section, the relationship between populism and economic freedom
is analyzed empirically. Economic freedom is measured by the index published in
Economic Freedom of the World: 2022 Annual Report (EFW) (Gwartney, Lawson,
Hall, and Murphy, 2022). Prior research has shown that this measure is related to
many other important variables, such as overall income and growth, investment,
unemployment, trade, entrepreneurship, democracy, and human rights (Lawson,
2022). Our most basic estimation model has the following functional form:

Figure 3.3: The evolution of populism in government, 1970–2019

0.75
0.50
Populism in government
0.25
-0.00
-0.25
-0.50
1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2018
Source: Celico, Rode, and Rodriguez Carreño, 2022; Lührmann et al., 2022; authors’ calculations.
∆EFWi,t = β1EFWi, t−1 + β2 POPi, t−1 + β3POLCONi, t−1 + β4IDEOi, t−1

+ β4logGDPpci, t−1 + δi + γt + ui, t
Following Rode and Revuelta (2015) to a large extent, we employ the annual
variation in the five-year rolling averages of the EFW index as our dependent vari-
able to determine the specific outcomes of government populism for following
changes in economic freedom, further introducing the initial average EFW index
value as a primary control variable. Initial values are always the preceding five-
year rolling average. An inverse relationship is expected between the initial aver-
age EFW value and the following change in EFW, indicating that countries with
a lower initial average EFW rating are likely to liberalize more rapidly in subse-
quent periods. Although the EFW index is only available on an annual basis start-
ing in the year 2000, we impute annual values for the preceding five-year intervals
on a linear basis, allowing us to estimate with the full dataset from 1970 to 2019.
Populism in government (POP) is the seat-share-weighted degree of populism
by Celico and colleagues (2022) for all parties that form part of a government coa-
lition, using information on coalitions by Lührmann et al. (2022), where we also
calculate the five-year rolling average. Again, following Rode and Revuelta (2015),
we expect populism in government to be associated negatively with changes in
the EFW index. As highlighted in the introduction, the association between pop-
ulism and economic freedom may, nonetheless, be mediated by political institu-
tions that establish strong checks and balances on an executive, or by the political
host-ideology of the populist government that is in power.
To control for the possibility that the relationship between populism in gov-
ernment and economic freedom may be significantly conditioned by a country’s
political institutions, we need to capture the degree to which that power is con-
centrated in a political system. To do so, we introduce the five-year rolling average
of the latest available version of the POLCON V index by Henisz (2000) to our
estimation model. This index relies upon a simple spatial model of political inter-
action, incorporating information on the number of independent branches of gov-
ernment with veto power and the distribution of preferences across and within

those branches, in order to derive the extent to which any one political actor is
constrained in his or her choice of future policies. The POLCON index ranges on
a scale from 0 to 1, where higher scores indicate more constrained institutional
settings. It is a little unclear what impact the POLCON index may have by itself
for subsequent changes in the EFW, but we expect an interaction term of POP
and POLCON to be positively associated with subsequent changes in economic
freedom. This would indicate that populism in government can do comparatively
less harm to economic freedom in institutionally more constrained settings, such
as in the example of Switzerland that was highlighted in the introduction.
In order to examine the possible effects of political ideology in connection
with government populism, we further introduce a measure of government ide-
ology calculated from information by Lührmann and colleagues (2022) to our
basic model. This index weights government parties’ economic positions by their
respective electoral performance, with the final index ranging on a scale from −3
to 3, where negative values represent an ideology on the political left and posi-
tive values represent an ideology on the political right, while zero represents the
political center. Previous findings indicate that, taken by itself, government ide-
ology may be an important determinant of economic freedom (Bjørnskov and
Potrafke, 2012, 2013; Jäger, 2017), with left-wing governments generally being
comparatively more harmful for the development of economic freedom. In this
case, government ideology should enter our equation with a positive sign. To
control for the fact that populist governments of different political ideologies
may also have different effects on subsequent changes in economic freedom, we
introduce an interaction term between variables POP and IDEO. Following the
discussion in the introduction, it is somewhat unclear whether we would expect
left-wing populism in government to be comparatively more harmful to economic
freedom than right-wing populism. On the one hand, the personalist tendencies
of populism and its underlying zero-sum logic may mean that it is generally harm-
ful for economic freedom, regardless of its political ideology. On the other hand,
populist movements on the right may be comparatively less harmful to economic
freedom, or potentially even promote it by challenging crony capitalism, although
the latter possibility is rather doubtful as outlined above.
Finally, a range of studies has found that initial average GDP per capita is a fun-
damental determinant of changes in economic freedom (e.g., Rode and Gwartney,
2012). Therefore, the logarithm of the five-year rolling average of GDP per cap-
ita in terms of purchasing power parity is also included in our basic model. This
data is taken from the latest version of the Penn World Tables (10,0) by Feenstra,
Inklaar, and Timmer (2015). We expect this variable to show up with a negative
sign in our regressions, indicating that countries with a lower per-capita income
will liberalize their economies comparatively quicker in subsequent periods.
All estimations further include country- and time-fixed effects, in order to
account for the specifics of different time periods and different countries. The
use of fixed effects together with our empirical strategy, which relates the level of
populism to subsequent changes in economic freedom, should somewhat allevi-
ate concerns of unobserved heterogeneity and reverse causality in our findings, at
least in the short run. Still, prior research has established an empirical link between
comparatively stronger political constraints and higher economic-freedom rat-
ings on the one hand (Pitlik, 2007; Lihn and Bjørnskov, 2017) as well as gov-
ernment populism and the slow but steady erosion of political constraints on

the other (Huber and Schimpf, 2017). It should thus be stressed that our overall
findings, and in particular the interaction effects, should be merely interpreted
as correlational evidence, and not in a causal manner. Table 3.1 shows summary
statistics for all variables employed in the estimations.
Table 3.1: Summary statistics

Variable N Mean Std. Dev. Min Max
EFW 2774 6,802 1,069 2,776 8,79
POLCON 2574 0,619 0,272 0 0,889
POP 2888 4,11 1,13 1,379 7,762
IDEO 2867 0,16 0,62 -2,435 2,28
logGDPpc 2862 9,412 1,02 6,62 11,40
Given the uncertain association of populism and autocratic governance dis-

cussed above, we further limit our estimation sample to electoral democracies
only, following the definition of Bjørnskov and Rode (2020). These authors elab-
orate on the minimalist democracy-dictatorship approach of Cheibub, Gandhi,
and Vreeland (2010), defining democracies as those regimes where legislative
and executive offices are chosen by contested and popular elections. Limiting the
sample in this way obviously means that we cannot say anything about the pos-
sible correlation of autocratic populism and economic freedom, which is already
an interesting research question in itself. It also means that some populist expe-
riences, which become increasingly autocratic over time, may drop out of our
sample when the country’s institutions no longer satisfy our minimalist defini-
tion of democracy anymore. For example, this is the case of Venezuela under the
governments of Hugo Chavez and Nicolás Maduro, which Bjørnskov and Rode
(2020) count as a civilian autocracy from 2016 onward. Notwithstanding, if we
are interested in the association of populism and economic freedom in conjunc-
ture with majority rule, limiting the sample in this way will give us much cleaner
and more reliable results.
4 Estimation results
Before we go into the description of our findings, briefly consider figure 3.4, which
gives an overview of the association between government populism and eco-
nomic freedom in a scatter plot. Here, country-year values are colored differently,
depending on whether the corresponding states are OECD members, or not. The
figure clearly shows a negative association between government populism and
economic freedom, and this seems to be the case for both groups of countries.
Notwithstanding, EFW levels seem to be somewhat higher, on average, while
overall government populism may in turn be lower, in OECD member countries.
Again, the figure makes clear to what a large extent populism and comparatively
low economic-freedom ratings may essentially be a phenomenon of non-Western
countries, where significant institutional checks and balances are also usually
absent. Of course, the observed association might be driven by the high correla-
tion between EFW scores and GDP per capita, for example, which is not con-
trolled for in the graphic. This will be analyzed more formally in the following.

Figure 3.4: Populism and economic freedom

8
6
Populism in government
Non-OECD
2 OECD
1
2 3 4 5 6 7 8 9
EFW index
Sources: Celico, Rode, and Rodriguez Carreño, 2022; Gwartney, Lawson, Hall, and Murphy, 2022; Lührmann et al., 2022; authors’ calculations.
Table 3.2 shows results from regressing the annual change in economic free-
dom on its initial level, as well as the full battery of control variables. As indicated
by the preceding figure, we show results for the full country sample, but further
divide our data between OECD countries and non-OECD countries. Taking first
some of the basic controls: table 3.2 shows that the initial average EFW score
is negative and highly significant as a determinant of subsequent changes in
economic freedom in the full sample, as well for both sub-samples. Thus, the
cross-country analysis indicates that countries with lower initial average levels of
economic freedom tend to achieve larger subsequent increases in the EFW index.
This result is consistent with Rode and Revuelta (2015), as well as the findings by
Rode and Gwartney (2012) and others. Coefficients obtained for log GDP per
capita are always negative as expected, and the variable is statistically highly sig-
nificant in the full sample. Notwithstanding, the two right-hand panels of table 3.2
make clear that this association seems to be driven by non-OECD countries, while
coefficients are negative but insignificant for the sub-sample of OECD countries.
This may essentially reflect the high correlation between two control variables in
our OECD sub-sample, where countries with higher initial average EFW ratings
also tend to present higher per-capita incomes and, on a comparative level, both
these variables tend to score high among OECD member countries.
Coming to our principal variable of interest, it can be observed in models (1) to
(3) of table 3.2 that government populism is negatively but insignificantly associ-
ated with subsequent changes in economic freedom in the full sample. Model (1)
also shows that both the POLCON and ideology variables present the expected
positive sign, but are both always insignificantly related to subsequent changes in
the EFW index in the full sample. This picture is consistent when we introduce an

Table 3.2: Estimation results

Full sample OECD countries non-OECD countries
(1) (2) (3) (4) (5) (6) (7) (8) (9)
EFW −0.040*** −0.041*** −0.040*** −0.037** −0.036** −0.039** −0.046*** −0.046*** −0.046***
(0.009) (0.009) (0.009) (0.014) (0.014) (0.014) (0.013) (0.013) (0.013)
POP −0.014 −0.014 −0.020 −0.008 −0.036** −0.010 −0.032* −0.037* −0.032
(0.010) (0.010) (0.015) (0.010) (0.017) (0.009) (0.019) (0.020) (0.019)
POLCON 0.024 0.021 −0.028 0.107*** −0.077 0.116** −0.004 −0.065 −0.006
(0.040) (0.039) (0.145) (0.035) (0.116) (0.036) (0.050) (0.247) (0.050)
POP*POLCON 0.002 0.039* 0.012

(0.007) (0.023) (0.048)
IDEO 0.000 −0.010 −0.002 0.027 0.027 −0.014 −0.013 −0.015 −0.022
(0.013) (0.035) (0.015) (0.017) (0.017) (0.036) (0.020) (0.021) (0.059)
POP*IDEO 0.010 0.011 0.001

(0.027) (0.010) (0.011)
logGDPpc −0.084*** −0.084*** −0.083** −0.055 −0.051 −0.052 −0.088** −0.087** −0.088*
(0.029) (0.029) (0.029) (0.044) (0.043) (0.043) (0.035) (0.036) (0.035)
N 2367 2367 2367 1104 1104 1104 1263 1263 1263
Adj.R2 0.419 0.419 0.419 0.451 0.453 0.453 0.416 0.416 0.415
WithinR2 0.090 0.090 0.090 0.097 0.101 0.101 0.094 0.095 0.095
Note: Heteroskedasticity robust standard errors in parenthesis: *** p < 0.01; ** p < 0.05; * p < 0.1.
interaction effect of our government populism variable and the POLCON index
in model (2), and an interaction effect of government populism and political ide-
ology in model (3). In both cases, the interaction effects again show the expected
positive sign, but are always statistically insignificant.
This picture changes when we divide our sample into OECD countries and
non-OECD countries in the right-hand panels of table 3.2. Model (4) shows
that, taken by itself, the association of government populism and changes in eco-
nomic freedom is also insignificant for our sub-sample of OECD countries, but
this negative association becomes statistically significant at the 5% level upon
introducing the interaction effect of government populism and the POLCON
index in model (5). The coefficient on the interaction term is now also posi-
tive and significant, indicating that populism in government will hurt economic
freedom comparatively less in OECD countries that exhibit strong institutional
checks and balances on the executive. The left panel of figure 3.5 is one possible
way of interpreting the interaction of both variables in model (2), indicating

Figure 3.5: Marginal impact of government populism on economic freedom by political constraints
OECD countries non-OECD countries

0.00
Marginal effect of populism in government
0.00
on economic freedom (90% C.I.)
−0.02
−0.02
−0.04
−0.04
−0.06
0.00 0.25 0.50 0.75 0.00 0.25 0.50 0.75
Polcon V Polcon V
Source: Authors’ calculations.
that an increase of one standard deviation in government populism is signifi-

cantly associated with a reduction in economic freedom for OECD countries
that exhibit relatively few institutional constraints on government power, while
government populism is inconsequential for economic freedom in countries with
strong constraints on government.
Interestingly, model (7) of table 3.2 shows that the association of government
populism and changes in economic freedom is, in turn, significant and negative
at the 10% level for the sub-sample of non-OECD countries. This would indicate
that government populism is associated with reductions in economic freedom in
non-OECD countries, regardless of the existence of political constraints. This is
further confirmed when introducing the corresponding interaction term in model
(8), which is graphically interpreted in the right-hand panel of figure 3.5: here, an
increase of one standard deviation in government populism is significantly asso-
ciated with a reduction in economic freedom for countries that exhibit compar-
atively lower institutional constraints on government power, but also for those
countries that exhibit comparatively higher constraints on government power.
The negative association between populist governance and subsequent changes
in economic freedom is thus not mediated by political constraints outside of our
sample of high-income Western democracies.
To be sure, the heterogeneity of our findings across sub-samples is probably
due to the important institutional guardrails that most OECD countries have in
place that put an important check on the power of populist governments. These
guardrails are often absent in many non-OECD countries, and the unchecked gov-
ernmental power of these electoral majoritarian democracies is probably what is
also reflected in our findings, explaining further why we do not find a significant
association between government populism and changes in economic freedom in
the full sample. Although we do not want to make any causal claims here, indi-
cations are that high-income democracies with strong checks on the power of
government may therefore be comparatively better protected against the poten-
tially negative outcomes of populist governments for economic freedom than
middle- and low-income democracies, where populist governance resulting from

Figure 3.6: Marginal impact of government populism on economic freedom by ideology
OECD countries non-OECD countries
0.025 0.00
Marginal effect of populism in government
on economic freedom (90% C.I.)
−0.02
0.000
−0.04
−0.025
−0.06
−0.050
−1 0 1 −2 −1 0 1 2
Government ideology Government ideology
Source: Authors’ calculations.
majoritarian elections may pose a real threat to economic freedom. In both sub-
samples, the estimated impact of populism on economic freedom is, on average,
only about one seventh of a standard deviation. This statistical effect is admittedly
small, but it should be kept in mind that our dependent variable measures annual
changes from five-year averages in the EFW index, meaning that we should not
expect it to be very big either. If these effects cumulate over the time period of one
or several legislatures though, they may become quite relevant indeed.
Models (3), (6), and (9) further introduce an interaction effect of government
populism and political ideology to the full sample, and both of our sub-samples.
While the interaction term is again insignificant in the full sample, figure 3.6 graph-
ically shows the marginal impact of populist governance for economic freedom,
dependent on political ideology for OECD countries and non-OECD countries.
In the left-hand panel of figure 3.6 it can be observed that, similar to the impact
of political constraints, the association between government populism and subse-
quent changes in the EFW index in OECD countries is mediated by the political
ideology of government to a significant degree. While left-wing populist govern-
ments are found to be associated with significant reductions in economic freedom,
populist governance on the political right seems to be statistically all but incon-
sequential for a country’s economic-freedom ratings. Similar to the findings by
Stöckl and Rode (2021) for financial markets, right-wing government populism
in Western high-income countries may, therefore, not necessarily be detrimental
to economic freedom. Still, we find absolutely no indications that populist gov-
ernments on the political right are engaged in the promotion of economic free-
dom either. In turn, left-wing populism is clearly associated with reductions in
economic freedom, on average.

The right-hand panel of figure 3.6 shows that the association between gov-
ernment populism and economic freedom in non-OECD countries is clearly not
mediated by political ideology to a significant degree. Albeit marginally insig-
nificant on the far right, indications are that populist governments of any politi-
cal ideology are associated with reductions in economic freedom ratings for the
mostly middle- and low-income countries that make up our sample of non-OECD
countries. Interestingly, the distribution of populist governments across the spec-
trum of political ideologies also seems to be much more extreme in that group
of countries, when compared to Western high-income nations in the left-hand
panel. Once again, it should be stressed that identification is uncertain but indi-
cations are that the impact of government populism on economic freedom in
high-income democracies may ultimately depend on the political ideology of the
populist government in power. In turn, populist governance is generally a threat
to economic freedom in middle- and low-income democracies, disregarding the
ideology of the populist government in power.
Conclusions
This chapter reinvestigates the association of government populism and eco-
nomic freedom following Rode and Revuelta (2015), who find empirical evi-
dence that populism and economic freedom are essentially incompatible. Still,
the study by Rode and Revuelta (2015) does not reflect the most recent populist
episode that is mainly right-wing in nature, it does not take into account the
potentially mediating role of institutions that restrict the power of the execu-
tive, and it was conducted at a time when the measurement of populism was
much more underdeveloped than at present. This chapter considers the poten-
tially mediating roles of institutional constraints and government ideology.
Furthermore, we employ a recent measure of populism by Celico, Rode, and
Rodriguez Carreño (2022) that offers much larger time and country coverage
than other comparable indicators.
Controlling for a series of other potential determinants, our results show that
populism in government is significantly associated with reductions in economic
freedom for a large sample of democratic countries. Here though, OECD coun-
tries are differently affected by populism in government than non-OECD coun-
tries. For OECD countries, the association of populism and economic freedom
seems to be mediated by political constraints and political ideology to a substan-
tial degree. In contrast, populism in non-OECD countries is generally harmful
for economic freedom and it is not mediated by political constraints and ideology
in a significant manner. The heterogeneity of our findings is probably due to the
important institutional guardrails that most OECD countries have in place, which
put an important check on the power of populist governments, and that are often
absent in many non-OECD countries.
To some degree, our results raise an important question: Is a political system
based on unchecked majoritarian democracy really the best method to preserve
economic freedom? This is an especially pertinent question at a time when many
democratic societies worldwide are becoming increasingly polarized on a multi-
tude of issues, and political populism on the left and right has firmly established
itself as a viable political option for electorates to voice their frustrations. Just to
make one thing absolutely clear: we are certainly not suggesting that some form

of soft autocratic rule is a better system to preserve economic freedom and wealth
creation than liberal democracy. This logic is deeply flawed in itself, because all
autocracies present at least a latent propensity towards political repression, which
further tends to increase over time, eventually also harming economic liberties.
Still, unchecked majoritarian democracy may do as much damage to economic
freedom and wealth creation as many repressive autocratic regimes. Following the
ideas of Hayek (2020), and to some degree those of Jones (2020), an ideal system
of government for the continued development of economic freedom would reflect
some combination of majoritarian rule with strong institutionalized checks and
balances that limit the power of the central executives. Historically, this balance
has been at the center of the idea of liberal democracy. However, in recent years,
this constrained view of democracy has been replaced by one based on unchecked
majoritarian rule. This change in the meaning and institution of democracy has
been true even in Western democratic countries. If this trend continues, its politi-
cal manifestation in unchecked populist rule may well present the most important
threat to individual liberty and economic freedom since World War II.
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Chapter 4 The Rule of Law and Economic Freedom
Two Sides of the Same Coin for Purchasing
Economic Prosperity
Matanda Abubaker
Though the earth, and all inferior creatures, be common to all men, yet every
man has a property in his own person: this no body has any right to but himself.
The labour of his body, and the work of his hands, we may say, are properly his.
whatsoever then he removes out of the state that nature hath provided, and left
it in, he hath mixed his labour with, and joined to it something that is his own,
and thereby makes it his property. ( John Locke, 1689/1980, §27)
Definition and philosophical basis for economic freedom

Freedom is basically the absence of constraint or coercion through force, fraud, or
theft. Anyone who roots for freedom generally has, of necessity, to do the same
for economic freedom specifically. If not for anything—at least for the mere fact
that economic freedom is a great enabler and root of all other freedoms.
In the liberal sense, the regulation of human affairs is only legitimate when it
is not born of force, fraud, or manipulation. This as well is the case for economic
freedom, which connotes many things to different people but for the purpose of
this article the definition by the Fraser institute is most appropriate and adopted:
Individuals have economic freedom when property they acquire without the
use of force, fraud, or theft is protected from physical invasions by others and
they are free to use, exchange, or give their property as long as their actions do
not violate the identical rights of others. (Fraser Institute, 2022)
This follows both the classical and modern conceptions of freedom, but most
profoundly, the historical proposition by John Locke, the English philosopher
who gave us the premise that individuals own, and should own, themselves (Rule
of Law Working Group, 2007: 101). This was and is a critical basis for the global
frowning at slavery, servitude, and forced labor, among others, which place a per-
son at the whims of other people’s interests, but also the violation of someone’s
ownership through deprivation of what is legitimately theirs.
Citation Matanda Abubaker, The Rule of Law and Economic Freedom: Two Sides of the Same Coin
for Purchasing Economic Prosperity. In James Gwartney, Robert Lawson, and Ryan Murphy,
Economic Freedom of the World: 2023 Annual Report (Fraser Institute, 2023): 207–220.
Author Matanda Abubaker is an Advocate of the High Court of Uganda and all Courts of Judicature, cur-
rently a Magistrate in the Uganda Judiciary, and a law lecturer at the Islamic University in Uganda.

Aware that there are always people who are happy to employ force and fraud
to acquire property, how then can a society guarantee this protection of rights to
personal property? This is where the rule of law comes in—to protect the individ-
ual’s life and property from force, fraud, and theft by laying out the rights, obliga-
tions, and boundaries of each individual, including the State, and aid in enforcing
the contracts he/she enters (Bufford, 2006). This is how, as we shall see in greater
detail, the rule of law becomes critical for economic freedom. Why should we,
however, care about economic freedom beyond philosophizing?
Whereas scholarly debates have raged for centuries and still do on whether
economic freedom is a necessary precursor to economic prosperity, and in effect
human flourishing, it is safe to say there has grown a great body of knowledge,
especially in the last three decades, that offers enough empirical evidence to cor-
relate, keeping other factors constant, economic freedom and the prosperity of a
country and its citizenry in their individual capacities.
The evidence is embedded in all the economic stories and fortunes of coun-
tries all over the world. Even just a cursive comparison of any country will eas-
ily reveal that the freer economically a country is, the more prosperous it is and
inadvertently the greater the standard of living for the people of such a polity
(United Nations, n.d.). In other words, one can correctly conclude that the rule of
law enhances economic freedom, which in turn does so for economic prosperity.
The relationship, however, is not as simplistic as the foregoing statements
might suggest. It is also observed that the relationship between the rule of law
and economic freedom is one of mutual or symbiotic benefit rather than of para-
sitic dependence. Granted, there can only be economic freedom if there is rule of
law, but it is also true that economic freedom enhances the rule of law. In short,
when one of the two is threatened, the other is too.
The rule of law

We have already briefly seen that one of the major anchors of economic freedom
is the rule of law. For a people that desire prosperity, therefore, and in the face
of converging crises around the world like COVID 19, climate change, and wars,
which are all exacerbated by the old-time catalyst, poverty, it becomes a worthy
pursuit, as they seek economic prosperity, to understand what then really com-
prises not just the relationship between economic freedom and the rule of law,
but what these concepts mean in different contexts. For this chapter, the rule of
law is discussed in the libertarian context. This is particularly important, beyond
scholarship, for countries that are still economically backward and whose peo-
ples still struggle to afford basics like food, and primary social services like shelter,
education, and access to health care.
Several studies have highlighted many strands to economic freedom including
the size of government, the independence of the judiciary, peace and stability among
others (Fraser Institute, 2022). It is easily discernible that all these strands are inter-
connected, and discussing one out of the rest may definitely not bring out the whole
picture. They all, however, apparently have a strong relation with the rule of law.
If we return to the definition of economic freedom by the Fraser Institute,
clearly there are among others two discernible components from the definition:
on one hand, the control over one’s labor, trade, and access to the market (the
basic forms of legitimate acquisition of property); and, on the other, control over

Chapter 4: The Rule of Law and Economic Freedom • 209
such property upon acquisition and freedom to deal with it through trade or dona-
tion as one chooses, and protection from expropriation, theft, or being defrauded.
I would add that the reverse is true when, that is to say if, unfortunately, as
reality always has it, a person loses property through force, fraud, or theft, eco-
nomic freedom is only guaranteed if there is a mechanism to ensure the same is
recovered, and returned to them as the rightful owners, with the possibility of
payment of the necessary damages and interests to return them to the position
they would be in if it were not for the deprivation.
The relationship between economic freedom and the rule of law has become
a very popular subject among scholars especially in the wake of the world eco-
nomic freedom index, and is relatively well covered all the same (Zywicki, 2003).
However, at a policy level, many countries around the world still seem to focus
more on the role of law as seen in the passing of legislation than on the rule of law,
which are different though intertwined. To better understand this, we have to take
recourse to the scholars who have shaped the global philosophical foundations
and debate on economics, some of whom have had significant impact on how we
view the rule of law or at least its constituting parts.
Adam Smith, Daron Acemoglu, and Johan Galtung set the ground for primacy
of rules or the law if you like, in shaping an economy (Waldron, 2020). Whereas
the law is a constituting part of the rule of law, the two should not be confused to
mean the same. The presence of laws in itself does not guarantee economic free-
dom. In the liberal sense, there is a further step needed for such laws to beget the
kind of the rule of law that promotes and enhances economic freedom, economic
growth, and development. This is in, first, the nature of the rules, and whether or
not they are enforced equally (Bufford, 2006: 309).
This is why, whereas all societies have laws, they all rank differently when it
comes to the rule of law and ultimately economic freedom. This is because some
of the laws inherently lead to deprivation of property while others are support-
ive of economic freedom but are either not enforced or, if they are, not enforced
equally. Further, and for example—as will be discussed later in this work when
dealing with an assessment of the correlations between rule of law and economic
freedom in Africa—some countries have laws but these laws are neither trans-
parently enacted nor implemented, which affects their effectiveness, applicabil-
ity, and acceptance. Thus, they end up being integrally inhibitive to economic
freedom. This sometimes is seen through undue regulation that cedes too much
power to public institutions and officials, that are oft corrupt or levying unreason-
able taxes, creating cumbersome bureaucracies that make it hard to do business,
instituting subsidies for some products, thereby distorting the market, and levy-
ing taxes, and/or fines that make it hard to do business (Wa-Kyendo and Kemboi,
2021). In such countries, therefore, individuals and private business players find
ways to thrive not through the laws but in spite of the laws, which undermines
not just the rule of law, but economic progress.
For the rule of law to thrive, the rules applicable must be clear, the processes
of adjudication transparent, and then the enforcement of judicial decisions by
institutions fair and certain. This calls for, among other factors, the rule of law to
ensure separation of powers, with the law making, implementation, and adjudi-
cation roles clearly distributed, and executed.
Let us dive a little deeper, then, into what the rule of law is. Simply and liter-
ally put, the rule of law (as contrasted with the role of law) is a situation where a

given society transparently and in a participatory manner promulgates and pro-

nounces rules or laws, that in their nature promote freedom and are supreme over
all, including the state and its officials, applying to everyone in the society with-
out discrimination. Needless to say, such rules must be just, understandable, and
alive to the realities of the members of the subject society for them to promote
the rule of law, which in turn promotes economic freedom. Elsewhere, the rule
of law has been otherwise precisely defined as the principle in which all persons,
institutions, and entities are accountable to laws that are publicly promulgated,
equally enforced, independently adjudicated and consistent with international
principles of human rights (United States Courts, 2019).
At the risk of repetition, it should be noted carefully that the rule of law, as
discussed in this paper is not just a case of the state and individuals being con-
strained by law (rule by law or role of law), as the classical definition of rule of law
would suggest, but a situation where such law is not bound up with principles that
threaten freedom. This means there are inherent values like human rights, less
state intervention, promotion and protection of property rights, among others,
which should be built into the laws to qualify for the rule of law herein described.
The main aim of the laws should be the protection of individual freedom and prop-
erty rights so they are able to promote economic freedom.
Where, then, is the relationship between such a system and economic free-
dom? Several studies over the years have consistently shown that there are strong
correlations between the rule of law, and economic freedom (Gwartney, Lawson,
Hall, and Murphy, 2022). Countries that score higher points on the Rule of Law
Index® (World Justice Project, 2022) also rank highly on the index of economic
freedom published in Economic Freedom of the World (EFW index), subject
to other variables or keeping other factors constant. As shown in table 4.1 and
table 4.2, the concentration of countries with a higher ranking in Rule of Law
Index® are the very ones that rank highly for economic freedom, save a few whose
deviations are easily explainable. By contrast, the countries with a lower ranking
on the Rule of Law Index® also rank poorly on the economic freedom front. The
majority of these are characteristically in the third world, where apparently most
Sub-Saharan Africa countries lie.
Tables 4.1 and 4.2 of the latest global rankings for rule of law and economic free-
dom offer some insights. From the two sets of rankings, even when each of the val-
ues (rule of law and economic freedom) have many variables, correlations between
the two are still glaring. For instance, the following can easily be observed:
1 For both indexes, the lowest ranking country is Venezuela. This is a testimony
of the relationship between the presence or absence of the rule of law and
economic freedom.
2 Related to the above, it is also observed that when the first and last twenty coun-
tries are extracted from both indexes, ten of the first twenty countries on the rule
of law index, also appear among the first ten. These are Singapore, New Zealand,
Denmark, Australia, Estonia, Ireland, Japan, Lithuania, Canada, and Netherlands.
3 Further, seven of the lowest ranking countries on the Rule of Law Index® also
appear among the lowest 20 on the EFW index. These are Gabon, Egypt,
Ethiopia, Democratic Republic of Congo, Zimbabwe, Sudan, and Venezuela.

Table 4.1: The first and last 20 countries in the Rule of Law Index 2022®
Country Overall score Global rank Country Overall score Global rank
Denmark 0.90 1 Congo, Republic 0.41 120
Norway 0.89 2 Honduras 0.41 121
Finland 0.87 3 Mozambique 0.40 122
Sweden 0.86 4 Ethiopia 0.39 123
Netherlands 0.83 5 Zimbabwe 0.39 124
Germany 0.83 6 Sudan 0.39 125
New Zealand 0.83 7 Gabon 0.39 126
Luxembourg 0.83 8 Bangladesh 0.39 127
Estonia 0.82 9 Uganda 0.39 128
Ireland 0.81 10 Pakistan 0.39 129
Austria 0.80 11 Bolivia 0.38 130
Canada 0.80 12 Mauritania 0.37 131
Australia 0.79 13 Myanmar 0.36 132
Belgium 0.79 14 Nicaragua 0.36 133
United Kingdom 0.79 15 Cameroon 0.36 134
Japan 0.79 16 Egypt, Arab Republic 0.35 135
Singapore 0.78 17 Haiti 0.35 136
Lithuania 0.76 18 Congo, Dem. Republic 0.34 137
Korea, Republic 0.73 19 Afghanistan 0.33 138
Czech Republic 0.73 20 Cambodia 0.31 139
Venezuela 0.26 140
Source: Rule of Law Index ® 2022 (World Justice Project, 2022)
Table 4.2: The first and last 20 countries in the 2022 EFW index
Country Overall score Global ranking Country Overall score Global ranking
Hong Kong SAR, China 8.59 1 Gabon 5.72 146
Singapore 8.48 2 Burundi 5.67 147
Switzerland 8.37 3 Yemen, Republic 5.67 147
New Zealand 8.27 4 Guinea- Bissau 5.64 149
Denmark 8.09 5 Egypt, Arab Republic 5.61 150
Australia 8.04 6 Ethiopia 5.58 151
United States 7.97 7 Chad 5.55 152
Estonia 7.95 8 Iraq 5.51 153
Mauritius 7.88 9 Lebanon 5.45 154
Ireland 7.86 10 Central African Republic 5.40 155
Armenia 7.84 11 Congo, Dem. Republic 5.36 156
Japan 7.82 12 Algeria 5.12 157
Lithuania 7.82 12 Congo, Republic 5.36 158
Canada 7.81 14 Iran, Islamic Republic 4.96 159
Georgia 7.78 15 Libya 4.95 160
Latvia 7.77 16 Argentina 4.87 161
Czech Republic 7.75 17 Syrian Arab Republic 4.63 162
Netherlands 7.75 17 Zimbabwe 4.48 163
Romania 7.74 19 Sudan 4.21 164
Iceland 7.73 20 Venezuela 3.32 165
Source: Economic Freedom of the World, 2022 Annual Report (Gwartney, Lawson, Hall, and Murphy, 2022)

It should be observed that there would probably be more overlap between

the indexes if several countries that ranked among the lowest 20 on the EFW
index were ranked on the Rule of Law Index®. These include Syria, Libya,
Central African Republic, Iraq, Yemen, and Burundi.
It is easy to see why a country that adheres to the rule of law easily achieves eco-
nomic freedom and ultimately prosperity. One cause of this is that predictability
and certainty of the economic systems which, as already highlighted is a precon-
dition for economic freedom, is a great contributor to an economy as it infuses
investor confidence and facilitates business operations. In explaining this, Fred
McMahon, in his article Rule of Law, Limited Government Key to Economic Freedom
in the U.S. and around the World (McMahon, 2018), explains how the index pub-
lished in Economic Freedom of the World offers some empirical evidence to prove
this. This is to the effect that the least economically free countries embrace a weak
or biased rule of law, which allows governments and greedy elites to attack the
economic freedom of the weak, poor, and unpopular while rich advanced indus-
trialized countries typically establish and enforce a sound rule of law.
To further illustrate this point, Mr McMahon offers the case of the Nordic coun-
tries of Sweden and Norway, which respectively rank 43rd and 27th overall in the
2022 EFW report: while they rank low in size of government (Sweden at 161st,
Norway at 153th—meaning they have large governments relative to the other 162
ranked countries and territories), they score well in rule of law (Sweden at 15th,
Norway at 3rd), which partly accounts for their high overall rank. This is in con-
trast with other advanced industrialized countries such as France and Italy, which
also have large governments (ranking 152nd and 122nd, respectively on size of gov-
ernment) but perform relatively poorly on the rule of law (23rd and 60th), a partial
explanation of their low overall ranking (France 57th, Italy 54th). Nearby Switzerland,
which has a relatively small government and sound rule of law, ranks 4th overall.
The rule of law and other factors that

facilitate economic freedom
We now look at how the rule of law relates to the other strands of economic free-
dom. Economic Freedom of the World highlights several aspects that guarantee the
rule of law. These include the size of government, which speaks to expenditures,
taxes, and state enterprises; the legal structure and protection of property rights;
the means of access to sound money by the citizens; the level of protectionism or
freedom to trade internationally; peace and stability; and the nature of regulation
of credit, labor, and business. We discuss some of these and how they relate back
and forwards to the rule of law.
Peace and security

The mechanism of enforcing societies’ dos and don’ts (the law) must be just to
ensure that the members of the society do not resort, as they often eventually do
in the face of injustice, to other means of fighting for or protecting their rights,
which often leads to political and social unrest. This is achievable through ensuring
the rule of law, which then becomes a condition precedent for peace and stability.
As already stated, there will always be people who pursue unjust enrichment
through the employment of violence, fraud, or theft. To stop them, a society

needs to have not only laws against the practices but also the means through
competent legal institutions (which we shall discuss further in this article) to
determine disputes arising out of such actions, but also settling claims of misun-
derstandings or breach of contracts, fraud. This in itself provides a peaceful mech-
anism of conflict resolution.
Checking the state and/or those in authority

against arbitrary regulation
Historically, the greatest sources of confiscation and expropriation have always
been the state, state officials or private but powerful individuals enabled by the
state’s actions or inactions. This comes in form of, for example, arbitrary grabbing
of property or laws that seem fair in the short term but ultimately lead to abuse
of individual property rights.
The former sometimes happens through outright expropriation of prop-
erty as happened in Uganda in 1972 with Field Marshal Idi Amin Dada expelled
Indians and caused their property to be expropriated and arbitrarily distributed
to Ugandans, or in Zimbabwe under Robert Mugabe, who took land from white
farmers and redistributed it to natives capriciously without compensation.
The other way is through a government of large size that in turn requires
higher taxation to fund, thereby depriving citizens of their property and capital
for investment, or running state enterprises that compete with the private sector,
or offering subsidies in favor of certain enterprises against others in the market
place, which takes away from citizens in favor of other entities or individuals.
Generally speaking, the state and state actors often wield a lot of power, sus-
ceptible to abuse. Left to their own devices, there are many ways state institutions
can be abused to limit economic freedom. This can also come about through
over-regulation by trade-creating monopolies engaging in predatory business
practices, implementing tax regimes that illogically take away the fruits of peo-
ple’s labor, ingenuity, and investment, among others.
The practical way to protect ordinary citizens, and private business entities
from the possibilities of abuse of this power by the state and state actors is in
having rules, through which the actions of all, including the state are checked.
This means protection from arbitrary conduct, making state moves predictable,
with recourse to adjudication in case there are disputes. Law enforcement and
adjudication must be independent enough to also check the state, and the cost of
administration should be kept at a minimum through smaller governments meant
basically to ensure security and mechanisms of enforcement of contracts.
How a state ranks on the rule of law is therefore critical to economic freedom
because it speaks not only to the administration of justice and the regulatory
framework for business and investment, but also to the protection of tangible and
intellectual property rights. The rule of law means, as demonstrated, there will be
clear regulations for trading, and starting businesses, and government agencies
and officials have well spelled-out responsibilities and functions, which reduces
room for corruption, bureaucracy, and the time taken to start and run a business.
Interestingly, governments that have inhibitive mechanisms often do not real-
ize that in the long run, if business is hampered, this will lead to a government not
being able to collect enough revenue to run itself, which is a recipe for state failure.
Cumbersome and costly processes and bureaucratic requirements to start and run
a business end up delaying and/or inhibiting running businesses, and blocking

new entrepreneurs from operating in the formal sector. These entrepreneurs will
resort to operating informally or bribing government officials to get the necessary
licenses, creating alternatives to beat the rules and operate, as earlier discussed,
hence undermining the rule of law. This, however, also undermines the develop-
ment of such enterprises because operating outside the formal legal framework
impedes them from access to formal credit and contracts from well-structured
institutions that require formal licenses.
It is, therefore, in the interest of every society and economic system to apply
the rule of law by having laws that are understood by all, in which they all partici-
pate in making and that facilitate rather than hamper trade, labor, and investment.
Tools like reduction of licensing fees and processes might look like they reduce
government revenue in the short run, but actually by making it easy to start and
run a business eventually increase revenue, bringing improvement in the stan-
dards of living thanks to gainful enterprise—great feats in the long run for both the
business and the government. This is besides attracting foreign direct investment
that is always on the lookout for favorable investment environments.
Enforcement of contracts and adjudication of disputes

The other measure of economic freedom is whether or not there is a competent,
independent, transparent, and quick judiciary. This is precisely what the rule of
law is equally about. What does it serve if a country has very good laws, as indeed
many do, if there are no effective mechanisms of interpretation and enforcement?
Where the judiciary is not independent from the influence of the executive, where
the decisions of the judiciary are procured by corruption or ignored by the execu-
tive enforcement agencies, then it becomes very hard to do business as contracts
cannot be enforced and capital will be very shy about entering such a country.
Production and exchange among individuals happen through contracts. A
contract is merely an exchange of promises. Many a time, people do not meet
their obligations and commitments in contracts. When this happens, one can only
hope for a competent, timely, and independent adjudication process to resolve
the conflict. Basically, there is no contract in the absence, on one hand of clearly
defined and consistent rights and obligations, and on the other of predictable and
systematic means to ascertain those rights and obligations in case of disputes, and
consequences in case of a breach.
A society therefore needs clear contracting laws, that encourage rather than
curtailing th freedom to transact, but very importantly, that also create structures
of the state like Courts that can hear and determine cases expeditiously on their
merit. There is no better guarantor of investor confidence than an independent
judiciary and functional systems of enforcing contractual obligations.
The law should therefore be clear on how judicial officers are to be appointed,
their qualifications, competences, the basis of promotion, and security of tenure such
that their decisions are credible and dependable. Further, individuals should have
easy access to the Courts—both literally and figuratively, that is, in terms of physical
reach but also in the actual dispensation of justice—, have timely and transparent
adjudication of their commercial disputes, and guaranteed enforcement of the deci-
sions eventually made by the Courts (Rule of Law Working Group, 2007). Such a sys-
tem benefits all but especially smaller enterprises that may not have the resources to
bribe their way through ambiguous contracting arrangements but, more importantly,
provides access to capital that is often attracted by efficient enforcement mechanisms.

It has also been shown that countries with robust adjudication systems also
extend effectiveness to alternative dispute-resolution mechanisms like interna-
tional commercial arbitration, which are often more confidential, quicker, and
less adversarial than the ordinary Court-based dispute-resolution methods
through ordinary resolution (Rule of Law Working Group, 2007).
The rule of law, protection of property rights,

and use of natural resources
John Locke in his theory of the social contract explained that the obligation of indi-
viduals to submit to a civil government under the social contract is based on the
assurance that the government though the state agencies is duty bound to protect
their natural rights including the right to private property (Locke, 1689/1980).The
state protects natural rights and private property rights by ensuring there is rule
of law where it is clear how property is acquired, traded, donated, and protected
with a view of averting theft, fraud, or force in these processes. Fundamental as
these individual property rights are, many countries around the world, especially
those in the Third World, still struggle with guaranteeing property ownership.
In sub-Saharan African countries like Uganda, it is very difficult and expensive
for one to process a land title or a copyright license. This makes many citizens
who otherwise would have property that they could use to secure credit unable
to do so because proving ownership is hard, and those who deal in credit cannot
trust their collateral, which is of less worth than it would ideally have. This in turn
restricts the participation of these citizens in the economy, reducing investment
and production to alleviate poverty and spur economic growth and development
(Gombya-Ssembajjwe, Banana, and Bahati, 2001).
This ties into the status of intellectual property rights in a given country. Where
innovators, creatives, artists, and authors are compensated for their works, they
are encouraged to create more. This is to say, where an economy has a robust
legal framework for protection of trademarks, copyright, and patents allowing
exclusive benefit—at least for a given time limit—and guaranteeing enforcement
of intellectual property, people will invest their resources in production, knowing
they will recover the same with profit.
The absence of such is a clear indicator that differentiates modern knowl-
edge-based economies and those that still rely on rudimentary means of produc-
tion, basically because there are no incentives for innovation from compensation by
the market. Suffice it to say that the products of a market that guarantees intellec-
tual property are also usually secure, more competitive, accessible, and safer for the
laborer and final consumer thanks to competition and motivation of the creators.
Some countries that have realized this have embarked on campaigns to enforce
property rights both in real and intellectual property. There are reports from
South America of hitherto struggling countries like Peru and Brazil that have
carried out accelerated campaigns to offer land titles to all, especially those who
only owned the same customarily. Further, Brazil mounted a campaign to ensure
enforcement of property rights but, beyond enforcement, to sensitize the public
such that the citizens understand the laws for the protection of intellectual prop-
erty, and the nature of such property rights (Rule of Law Working Group, 2007).
On property, the rule of law is also extended to the question of use of natural
resources. Many countries expropriate natural resources in the name of being a

trustee for the people and in the process dispossesses them not just of the natural
resources but also the accessory property like land, among other items. Through
the rule of law, the human rights of the persons affected by the exploitation of the
natural resources are catered for: where they have ownership in the resources,
they are not deprived of their stakes in the resources or accessory property.
Where there is inclusive utilization of natural resources, the rule of law ensures
safety of the investments and alleviation of poverty.
Countries that observe the core foundations of the rule of law in dealing with
natural resources realize economic transformation while the resources become
curses and lead to the Dutch disease where there is arbitrariness in exploitation
of the resources plundered for the benefit of a few members of especially the
ruling classes.
The rule of law in Africa

We have already seen that to guarantee the rule of law the cycle starts with trans-
parent and participatory promulgation of laws, then the liberal nature of the laws
in the protection of property, and the just, equal, and efficient enforcement of the
laws. Many African countries struggle at all these levels.
A majority of nations or, more appropriately, political regimes in Africa, per-
haps out of necessity to hold political power and, in some cases, through pressure
from development partners, seem to have appreciated the role of law. This is seen
through the enactment of constitutions and laws across the board, which for the
most part acknowledge and establish free-market economies, at least on paper.
Despite having laws in place, however, the majority of them struggle with
not just arbitrary legislation but lack of public awareness, and the implementa-
tion, and effectiveness of these laws. Application of the law often suffers from
political and affluence expedience. So, in almost all cases, the laws are neither
democratically promulgated, equally enforced, independently adjudicated, nor
binding on the state and state actors thanks to their impunity. This is evident in
table 4.1 where, among the 21 countries that score the lowest, 11 are from Africa:
Republic of Congo, Mozambique, Ethiopia, Zimbabwe, Sudan, Gabon, Uganda,
Mauritania, Cameroon, Egypt, and the Democratic Republic of Congo.
The majority of African countries grapple with poverty, war, hunger, disease
more than other countries on earth. The rule of law would therefore be critical
because it enhances the much-needed economic growth and development in var-
ious ways like establishing peace and stability already highlighted in this article.
The United Nations General Assembly has highlighted, among other things, the
importance of access to justice for all and in this regard encouraged the strength-
ening and improvement of the administration of justice; and emphasized respect
for the rule of law and property rights and the pursuit of appropriate policy and
regulatory frameworks as primers to encourage business formation, including
entrepreneurship that contribute to poverty eradication (United Nations, n.d.).
African countries therefore would have a chance for prosperity, if the govern-
ments promote the rule of law with a view of enhancing economic freedom.
In the last six decades, there has been heightened regard for the rule of law
in African countries born either of pressure from development partners or from
internal agitation. The indicators from various studies, however, show that
whereas there have been advances, a lot is still desired to be done especially given

that the societies are enthralled to extractive institutions and legal frameworks
rooted in an oppressive governance history and colonialism (Guest, 2004). No
wonder the indexes of the rule of law and of economic freedom both show that
they all remain a challenge despite these advances.
For most African countries, formalization of laws and efforts geared towards
the rule of law took shape in the early 1960s when they gained independence
and later in the 1990s with the liberalization movement at the end of the Cold
War, which came with establishment of constitutional democracies across the
continent (Iqbal and Khan, 1998). However, there has been retrogressive move-
ment in countries like Somalia, South Sudan, Mali, Democratic Republic of
Congo, and Nigeria among others caused by war, terrorism, and civil strife. In
situations of war, the institutions of the state are not effective and therefore
contracts cannot be enforced. Capital, especially for foreign direct investment,
being shy flies away, and there is no credit to speak of for those interested in
entrepreneurship to start small and medium-sized enterprises (Fang, Kothari,
McLoughlin, and Yenice, 2020).
Further, even for countries that are stable, rooting separation of powers
remains a challenge as appointment of judicial officers is still fettered with cor-
ruption, nepotism, and other factors, leading to judiciaries that are not indepen-
dent. This is worsened by poor funding that avails few officers, leading to a case
backlog. Cases take as much as two decades, thereby holding up capital and other
factors of production. According to a 2020 World Bank report, the Land Division
of the Ugandan High Court alone has over 10,000 cases to be handled by only
seven judges. Some of these cases date as far back as 1990 (World Bank Group,
2020). This means commercial disputes can take up to decades before resolution,
which makes business difficult.
Uganda, for example, which has been relatively stable, has its ranking on the
Rule of Law Index® worsened by corruption and abuse of fundamental rights,
despite improvements on the front of an open government, regulatory enforce-
ment, and constraints on government (World Justice Project, 2022). There are
also cases of non-implementation of judicial decisions by the executive arm of
government. So, beyond just influence peddling, even where Courts make deci-
sions, these sometimes are ignored and not implemented rendering them nuga-
tory (Okakwu, 2017). It still remains difficult to win and implement cases against
powerful members of the ruling elite who engage in grabbing of property. Cases
of corruption, which subverts money that would be useful for investment, are not
prosecuted as the corrupt possess unprecedented levels of impunity.
Governments in many African countries also ignore their liberal policy posi-
tions and act contrary to them with abandon. They profess to having free-market
economies but go ahead and create monopolies, increase the tax burden, and
throw around cash gifts to their hangers-on; and they continue to create parastatal
organizations to compete with the private sector (Masaka, 2013).
This is not to say to there are no positive strides for the rule of law on the conti-
nent. Some countries like Kenya have seen significant reformation of not just their
economies along free-market principles but also specific reforms of sectors like the
judiciary by way of changes in the funding models, more transparent appointment
of judicial officers, expansion of staff, and creating facilities for training and access
to justice with a view of spurring access to justice and economic development
(Open Government Partnership, 2020: 25).

There has also been a lot of work done by civil-society organizations to pro-
mote the rule of law by sensitizing the citizenry to create awareness about their
rights and obligations. These have also been pivotal in calling for and causing the
passage of legal reforms through parliaments.
Global, regional, and sub-regional agreements and reforms have also been able
to open up space for trade, and the rule of law, as countries share and benchmark
from one another, and make commitments to multi-lateral arrangements that fos-
ter trade across boundaries. These support standardization of contract regimes,
mechanisms for alternative dispute resolution like international commercial arbi-
tration and mediation, among others. The African Continental Free Trade Area
(AfCFTA) for example describes itself on its website as:
The world’s largest free trade area bringing together the 55 countries of the
African Union (AU) and eight (8) Regional Economic Communities (RECs).
The overall mandate of the AfCFTA is to create a single continental market
with a population of about 1.3 billion people and a combined GDP of approxi-
mately US$ 3.4 trillion. The AfCFTA is one of the flagship projects of Agenda
2063: The Africa We Want, the African Union’s long-term development strat-
egy for transforming the continent into a global powerhouse. As part of its
mandate, the AfCFTA is to eliminate trade barriers and boost intra-Africa
trade. (AfCFTA, 2023)
The shift towards free trade born of these international and regional arrange-
ments has been very critical. The AfCFTA, for example, is key in dismantling
trade barriers and implementing competitive regulatory regimes and principles
of justice that foster investment and free trade, protection of intellectual property,
the rule of law, and removal of barriers to investment and trade. They also facili-
tate the enforcement of decisions born out of alternative dispute resolution like
commercial dispute arbitration.
Globalization has been another indirect driver of the rule of law among African
countries. The necessity of trading with other countries, and competing for the
global market has forced many African countries to make progressive reforms
especially in their judiciaries and mechanisms for enforcement of contracts. As
already highlighted, however, many African countries still have a long way to go
before realizing the rule of law that makes significant impact on their levels of
economic freedom.
Conclusion
It is clear that the rule of law has a great bearing on economic freedom, which in
turn fosters economic prosperity. This therefore means any country that seeks to
prosper economically must pay attention to the rule of law as discussed here and
any study on the economic development or the lack of it of any country is incom-
plete without studying the status of economic freedom and its pillar, the rule of
law. Attention, however, has to be paid to the nature of “laws” before their “rule”
can be beneficial to economic freedom.

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Chapter 5 Diamonds, Dynasties,
or Decent Decisions?
The Origin of Botswana’s Liberal Policies
and Their Contemporary Unravelling
1 Introduction
In the four decades between 1961 and 2001, the average Gross Domestic Product
(GDP) per capita in sub-Saharan Africa (hereinafter “Africa” or “SSA”) grew by
0.27% (World Bank, 2023b). For many African states, the post-independence
era saw stagnant growth, economically illiberal governments, political turmoil,
and war. The pessimism surrounding Africa’s economic outlook went mainstream
in 2000 when The Economist described Africa as the “hopeless continent”. Yet,
despite the region’s poor economic outlook, during this time one African state
grew faster than any country in the world. In the three decades following the
nation’s independence in 1966, Botswana’s average GDP growth rate was the
highest globally at 11.1% (World Bank, 2023a). Similarly, between 1966 and 2021,
the growth rate of Botswana’s GDP per capita was more than 10 times the African
average, at 4.91% per year (World Bank, 2023c).
When Botswana attained self-governance in 1965, it was the third poorest
nation in the world (Beaulier, 2003: 231) with a GDP per capita (current US$)
of just $80.20 (World Bank, 2023b), more than half the African average. At the
time, the illiteracy rate was over 75% (Sebudubudu and Molutsi, 2011: 9). The
nation had just 20 students studying at university and approximately 1,000 pupils
in secondary school (Munger, 1965: 42). According to Acemoglu, Johnson, and
Robinson (2003: 80–83), in 1965 the nation had 22 university graduates and 100
secondary-school graduates. When Botswana became independent in 1966, it
Citation Alexander C.R. Hammond, Diamonds, Dynasties, or Decent Decisions? The Origin of
Botswana’s Liberal Policies and Their Contemporary Unravelling. In James Gwartney, Robert
Lawson, and Ryan Murphy, Economic Freedom of the World: 2023 Annual Report (Fraser
Institute, 2023): 221–248.
Author Alexander C.R. Hammond is the Founder and Director of the Initiative for African Trade and
Prosperity, a Free Trade Fellow at the Institute of Economic of Affairs (IEA), a Senior Fellow
at African Liberty, and a Fellow at EPICENTER.

was experiencing the worst drought in 30 years. At the time, one in three citizens
relied on government rations to survive (Samatar, 1999: 63), and life expectancy
was 53 years (World Bank, 2023e). Minimal infrastructure spending meant there
were just 12 kilometres of paved roads in the country (Acemoglu, Johnson, and
Robinson, 2003: 80).
Yet, despite its initial poverty, according to World Bank classifications,
Botswana became a “middle-income’ country in 1986 and in 2005 it was desig-
nated as an “upper-middle-income” state (McCaig, McMillan, Verduzco-Gallo,
and Jefferis, 2015: 1). In 2021, Botswana’s GDP per capita (current US$) was
over $6,805, more than 4.1 times the sub-Saharan African average (World Bank,
2023b). Literacy rates are now above 90% (Sebudubudu & Molutsi, 2011: 9), and
more than 56,000 Batswana students are enrolled in tertiary education. In 2019,
more than 11,900 students graduated from Botswanan universities, with the vast
majority of graduates being Botswanan (Human Resource Development Council,
2021: 16–20). In 2020, the average life expectancy was 66 years (World Bank,
2023e), and there are now more than 7,255 kilometres of paved roads (Statistics
Botswana, 2021: 2), representing an increase of over 60,000% since 1966.
Furthermore, despite extensive diamond resources and revenues, the nation
has avoided the so-called “resource curse” or “Dutch disease”. Botswana has never
experienced a coup d’état, significant government infighting over control of natu-
ral resources, or a civil war. Botswana has seemingly overcome any adverse legacy
of colonial rule—it is also landlocked and the majority of the landmass is unpro-
ductive desert—three important factors that some academics argue are unfavor-
able for economic growth.
For avoiding many potential developmental pitfalls and rising from severe pov-
erty to relative prosperity, Botswana is often heralded as an African “miracle” and
“success” story in both academic and popular articles (Acemoglu, Johnson, and
Robinson, 2003; Lewis, 2006; Masire, 2006; Tupy, 2019). There is a broad con-
sensus among scholars that Botswana’s growth can be attributed to good policies
that are usually described as ‘liberal’. However, there is substantial disagreement
within academic circles as to why Botswana adopted these liberal policies, espe-
cially when almost no other African nation did so to the same degree.
Through historical analysis and using chronological data related to economic
freedom (Lawson and Murphy, 2023), which have been largely used too little in
the existing literature, this study adds credence to the theory that the introduction
of liberal policies in independent Botswana was a result of the decision-making
of the Botswanan government. However, the “good leadership” hypothesis alone
provides an inadequate explanation. Instead, the stability of Botswana’s political
system, coupled with some good leadership choices that were underpinned by
external constraints limiting the elite’s decision-making, provide a more robust
explanation of the origin and extent of Botswana’s economically liberal policies
after independence.
This finding could have immense contemporary importance as many of the
constraints that once bound the Overton window through which the government
of Botswana could implement policy have become increasingly insignificant. The
unravelling of these constraints may explain some of the alarming warning signs
we have seen from the nation in recent years; from United Nations concerns over
the nation’s human rights records, warnings of rapid backsliding in the area of civil
and political rights, and increasingly hostile political infighting.

Chapter 5: Diamonds, Dynasties, or Decent Decisions? • 223
2 Literature review and existing hypotheses

Most economists agree that economically liberal policies that align with the five key
areas of economic freedom described in Economic Freedom of the World (EFW)
(Gwartney, Lawson, and Murphy, 2023), are conducive to economic growth.
According to some academics, other factors that can undermine or promote eco-
nomic development include geography, resource abundance, and stability.
Economic liberalism as the origin of economic growth in Botswana

Nearly all academics who have written on Botswana’s economic development
agree that, after independence, Botswana adopted policies that can be considered
economically liberal and these policies help explain Botswana’s rapid economic
growth. Beaulier explains that Botswana’s economic development is a conse-
quence of the government’s decision to “respect the rule of law, protect private
property rights, and limit the government’s scale and scope” (2005: 2). Seidler
(2010: 5), Martin (2008: 45), and Mbao and Komboni (2010: 49–52) have also
proposed that, since independence, the ability of successive governments to keep
corruption and taxation low has contributed to economic development.
Acemoglu, Johnson, and Robinson (2003) have highlighted the critical role
of Botswana’s relatively strong institutions, especially in property rights. Seidler
has similarly claimed that Botswana’s strong institutions are “fundamental to the
The geography and a brief history of Botswana
Botswana is a landlocked country in Southern Africa that, with a land area of 566,730
square kilometres (World Bank, 2023d), is slightly larger than Metropolitan France.
The Kalahari Desert makes up 84% of Botswana’s land area. Only 4% of the land
is suitable for cultivation (Seidler, 2010: 3), and around 80% of the population lives
along the fertile eastern border (Parson, 1984: 4). Since independence, Botswana’s
population has skyrocketed from 575,000 inhabitants in 1966 to over 2.58 million
today (World Bank, 2023g).
The Tswana migrated to the territory that is modern-day Botswana in the eigh-
teenth century and were primarily cattle traders (Acemoglu, Johnson, and Robinson,
2001: 92–93). Following a series of successfully defended attacks from the Boers
(most notably at the Battle of Dimawe in 1852), the Tswana leadership under Chief
Sechele asked Britain to protect Bechuanaland. Despite initially rejecting the request,
following Germany’s annexation of South-West Africa (today’s Namibia) in 1884, in
1885, out of fears of losing their main corridor to South Africa, the British formally
established the Bechuanaland Protectorate.
In 1967, a year after independence, large diamond reserves were discovered by
De Beers in Orapa. In 1968, De Beers and the Botswanan government established
a joint company, Debswana. The percentage of diamond profits allocated to the
Botswanan government has increased from 15% in 1968 to 80.8% today.
The Orapa mine became operational in 1971, and the Jwaneng diamond mine,
which opened in 1982, remains the richest diamond mine in the world by value.
Today, diamond profits account for between one quarter and one third of the coun-
try’s GDP and between 70% (Meijer, 2012: 2) to 90% of Botswana’s exports. For
decades Botswana has been one of the leading diamond exporters and possesses
approximately 20% of the global supply.

country’s economic success” (2010: 1). Lewis (2006: 1) and Beaulier and Subrick
(2006: 105) also suggested that democracy has played a large role in the nation’s
economic development. Rodrik highlights Botswana’s attention to sound money
and describes the nation as having “an admirable record with respect to mac-
roeconomic stability” (2007: 39), and the OECD acknowledges Botswana has
had “prudent macroeconomic management” (OECD & African Development
Bank, 2002: 49).
Three other factors affecting economic growth

Beyond the policy considerations related to economic freedom, three other fac-
tors that may drive or limit economic growth are worth exploring. First, some aca-
demics such as Sachs and Warner (1995, 1997), Diamond (1997), and Sachs (2001)
suggest that geographical variables, such as climate, coastal proximity, the pres-
ence of navigable rivers, and distance from the equator, help determine economic
stability and growth. However, if geographical factors played a significant role in
Botswana’s economic development, one might expect the nation, which is close
to the equator, mostly desert, and landlocked with few navigable rivers, to be
economically unsuccessful. As this is not the case, clearly other non-geographical
factors are of greater importance in driving Botswana’s economic growth.
Second, some scholars such as Leite and Weidmann (1999), Sachs and Warner
(1995), and van der Ploeg (2011) suggested there is generally a negative correla-
tion between significant resource endowment and economic growth. However,
Kaznacheev (2017) argues that the quality of institutions and policies determines
if natural resource abundance is a curse or a blessing. Kaznacheev’s argument that
better institutions mean resources become an economic “blessing” rather than a
“curse” is likely the case in Botswana. As Seidler explains, Botswana’s resources
were not economically disastrous because the government applied “useful poli-
cies” (2010: 4). Similarly, Acemoglu, Johnson, and Robinson note “diamonds no
doubt helped” but “there is almost complete agreement that Botswana achieved
this spectacular growth because it adopted good policies” (2003: 83–85).
Third, Grossman (2000) found that the higher probability of political instabil-
ity and revolution leads to a government that is more likely to adopt predatory
extractive policies. However, Grossman’s analysis is also true in reverse; rulers
who can rely on long-term tenure in office will likely be less predatory and imple-
ment policies more conducive to economic growth. Botswana is an incredibly
stable nation, especially compared to other states in sub-Saharan Africa. Since
independence, Botswana has never experienced a coup d’état, and its government
has never formally uncovered any coup plots (Beaulier and Subrick, 2006: 111).
As outlined later in this chapter, Botswana’s economic policies are also uniquely
stable compared to other SSA countries.
To conclude, geographical factors are usually considered of little relevance to
Botswana’s growth. While diamonds assisted with growth, the implementation
of good policies is considered as the primary reason Botswana managed to avoid
the “resource curse”. However, the role of stability in the nation’s development
deserves greater consideration. There is almost a unanimous agreement across
the existing literature that Botswana did adopt economically liberal policies after
independence. However, the reason that Botswana adopted these policies, espe-
cially when almost no other newly independent African state did so to the same
degree, has been debated at length in the literature.

Competing hypotheses on the origin

of economic liberalism in Botswana
Usually, academics that have studied Botswana’s liberalism adopt a multidimen-
sional approach to explain the origin of said policies (though scholars typically
champion one hypothesis more than another.) For this reason, and in order to
disentangle the competing approaches, the remainder of this section is segmented
by hypotheses, rather than by author.
Hypothesis A British benign neglect preserved good pre-colonial institutions

Several authors (including Acemoglu, Johnson, and Robinson, 2003; Dale, 1995;
Englebert, 2000; Robinson, 2009; and Seidler, 2010) credit the development
of liberal policies in Botswana to good traditional institutions that, because of
“light rule” (Seidler, 2010) or “benign neglect,” (Dale, 1995) on the part of the
British during colonialism, were left relatively untouched. Authors that propose
this hypothesis have presented at least one of the following pieces of evidence to
highlight Britain’s supposed disinterest in actively governing the region or engag-
ing with (or dismantling) traditional institutions.
1. Bechuanaland’s colonialization was unique because the chiefs asked for British
protection in 1885 and, in the same year, the British High Commissioner stated
Britain had “no interest” in Bechuanaland “except as a road to the interior” and
that Britain will do “as little in the way of administration or settlement as possible”
(quoted in Picard, 1987: 36).
2. This being the case, Britain’s “minimal level of involvement” (Cook and Sarkin,
2010: 466) meant traditional chiefs maintained their power over the judiciary,
legislative, and executive functions (Seidler, 2010: 9).
3. The lack of interest in the region is reflected in the fact that, throughout British rule,
more than 75% of spending went to colonial administrative costs (Parson, 1984: 22).
4. The European population in the protectorate stayed comparatively low, at approx-

imately 1% (Lewis, 2006: 7) and, for most of the colonial era, there were only
around 20 colonial administrators (Mitchell, 1995: 38).
There is broad agreement among proponents of this hypothesis that this disin-
terest from the British preserved pre-colonial institutions and tribal structures,
which were maintained and successfully integrated into the modern Botswanan
state (Englebert, 2000: 13-14; Robinson, 2009: 187–194; Seidler, 2010: 2). For
these authors, the maintenance of traditional institutions was beneficial for liberal
policies after independence for the following reasons.
1. The Tswana had a tradition that, through the kgotlas,1 allowed criticism of the
chief, were tolerant of dissent, ensured “equality between the chief and his con-
stituents” (Beaulier, 2003: 228), promoted consensus-seeking (Seidler, 2010: 9),
and integrated other groups not ethnically Tswana (Robinson, 2009: 8).
1 Kgotlas are gatherings in traditional Tswana society that can act as a meeting, general council,
or law court. They are headed by the local chief, who is accompanied by his advisors.

2. Tswana political institutions, unlike those of other African tribes, “constrained”

the “power of the chiefs” and promoted “able and pragmatic leadership” (Seidler,
2010: 9–14).
3. Unlike many other pastoralist tribes in Africa (who often managed goats), the
cattle-farming Tswana were not nomadic, which led the Tswana having a tradi-
tion of using and protecting private property (Acemoglu, Johnson, and Robinson,
2003: 94–95).
4. Tswana institutions encouraged the elite to engage in economic activity unrelated to

politics (usually cattle farming) (Seidler, 2010: 9), which encouraged chiefs to make
“sound economic decisions” that benefited the entire tribe (Beaulier, 2003: 228).
Hypothesis B The British left good institutions

While no prominent scholar mentioned in this chapter believes the continuation
of British institutions is the sole explanation for the nation’s adoption of liberal
policies, several academics suggest this factor is of relative importance.
Unlike the situation in many other African colonies where extractive institu-
tions were developed, according to Acemoglu, Johnson, and Robinson, one reason
that Botswana adopted good policies after independence is that the government
“sustained the minimal public service structure it inherited from the British” (2003:
83). Beaulier also notes that part of Botswana’s success can be attributed to the
fact that it “inherited a British common-law legal framework” and managed to pre-
serve some of the most “important aspects of British common-law” (2003: 231).
As with Hypothesis A, the argument implicit in Hypothesis B is that, because
the British were not interested in actively managing the region, extractive insti-
tutions were not developed. However, exponents of Hypothesis B put greater
emphasis on the claim that Bechuanaland benefited from being a British colony
as it meant the region inherited systems that protected property and maintained
the rule of law. Admittedly, Acemoglu, Johnson, and Robinson (2003) did note
the ability of the government of Botswana to develop the public service structure
into a meritocratic, relatively noncorrupt, and efficient bureaucracy were other
important factors. Similarly, Beaulier notes that the government of Botswana
made good decisions to acknowledge the utility of and keep in place “some British
institutions” (2005: 7) and that the incorporation of “customary practices”, into
British common law was important (2003: 231).
Hypothesis C Good leadership

Ayittey (1992: 10) was one of the first and most prominent academics to posit that the
bad policies, poverty, violence, weak institutions, and corruption in African states
is almost entirely due to the “atrocious” decisions made by post-independence
leaders. According to Ayittey, uniquely good leadership in Botswana (compared
to the SSA norm) led to the nation’s economic and institutional success.
Beaulier (2003, 2005), who arguably champions this hypothesis more than
any other academic mentioned in this chapter, emphasizes the importance of the
post-independence leadership. For Beaulier, Botswana’s “crucial moment came
in 1965” when the Botswana Democratic Party (BDP) won the election, and “the
future of Botswana was dependent on the decisions made by Khama and his admin-
istration” (2003: 236). According to Beaulier, in this crucial moment, “Khama …

made good policy decisions during Botswana’s post-colonial transition” and chose
to “adopt pro-market policies on a wide front” (2003: 236–237). In doing this, the
government of Botswana embraced the “rule of law [and determined to] protect
property rights, and limit the government’s scale and scope,” while liberalizing
trade, lowering taxes, and increasing personal freedoms (Beaulier, 2005: 2). These
“wise choices by Khama” at a “critical point in time,” according to Beaulier (2003:
237), is the primary reason for Botswana’s economic success.
Other scholars supportive of the “good leadership” hypothesis but who put
less emphasis on the immediate moment after independence include Sebudubudu
and Molutsi, who suggest the nation’s good policies and economic success lies
in “good leadership” and a “genuinely conscious elite” (2011: 10–44). Similarly,
Kiiza also pinned the nation’s liberalism on policy makers’ decisions and the
BDP’s “pragmatic economic ideology” (2006: 12). Placing a greater emphasis
for Botswana’s economic liberalism on the choices of the post-independence lead-
ership has gained significant traction in recent years and has been mentioned
numerous times in popular articles (Matthews, 2021; Mitchell, 2018; Tupy, 2020).
3 Methodology
The primary source of data used in this article is the Fraser Institute’s Economic
Freedom of the World: 2023 Annual Report (Gwartney, Lawson, and Murphy,
2023; this edition). Using this data allows the examination of Botswana’s liber-
alism from 15 years before independence to 2021. These findings then present
empirical evidence against which the three hypotheses in the literature review
can be tested, and a new chronologically sensitive hypothesis can be proposed.
The current edition of Economic Freedom of the World measures 165 jurisdic-
tions’ level of economic freedom across 43 variables, which are segmented to
form five major areas; the size of government, legal system and property rights,
sound money, freedom to trade internationally, and regulation. Each jurisdic-
tion is assigned, across 43 variables, a score out of 10. A higher score indicates
that a jurisdiction has lower levels of government consumption, stronger prop-
erty rights and legal systems, fewer legal restrictions on the economic freedom of
women, a more stable currency, greater trade liberalisation, and fewer regulatory
barriers. Third-party data, which is readily available to researchers, are used to
create the index published in Economic Freedom of the World (EFW index), thus
ensuring greater objectivity of the findings.
According to several academics (Dawson, 2007: 185; Jäger, 2017: 260)
Economic Freedom of the World has been praised as the “gold standard” for mea-
suring economic freedom. As data similar to that provided by the EFW index can-
not be gathered from other indices (usually because of an inadequate time series),
the use of the EFW index in this article is necessary. A key benefit of using historic
EFW data in this article is that these data can shed new light on the chronology
of Botswana’s adoption of liberal policies, which is too often absent in the exist-
ing literature. For example, when Robinson (2009: 7) suggested Botswana has
developed strong institutions, he presented only the World Bank’s Government
Indicators from 2009. Seidler (2010: 4–5), when looking at Botswana’s institu-
tional strength, also used only the World Bank’s Governance Matters data from
2009 and, when assessing the nation’s relative economic performance, relies on
data from just 2005. Similarly, when providing evidence of Botswana’s low taxes,

Beaulier and Subrick (2006: 110) used a single piece of data from 1999. When
analysing how the nation has relatively good metrics on the rule of law and gov-
ernment effectiveness, the same authors (Beaulier and Subrick, 2006: 106) used
single data points from 2004.
To summarize, the current literature has often presented a static analysis of
where Botswana ranks across various metrics at a single point in time and usu-
ally disregards the time frame over which Botswana became progressively more
economically liberal. This blind spot ultimately leads to several hypotheses that
are not causally related to the chronology of the unfolding phenomenon. The
chronological focus of EFW data and the conclusions that can be drawn from
such findings aid in remedying this problem.
Limitations
There are some minor limitations in the use of the EFW data for this study. The
data available for the five areas of economic freedom for Botswana date back to
either 1970 or 1975. This means tracking the changes made immediately after
independence is not possible. However, this issue does not significantly under-
mine this discussion for two reasons. First, an absolute EFW score for Botswana
extends to 1950, meaning it is still possible to track the broad development of eco-
nomic liberalism in the nation from 16 years before independence until 2021 (the
most recent data available). Second, any significant liberalization immediately
after independence should be borne out in the data from 1970 and 1975 onwards.
No prominent academic work has proposed Botswana became significantly freer
immediately after independence, but then declined by 1970 or 1975.
As this chapter is largely reliant on a single dataset, it means any empirical anal-
yses on the validity of existing hypotheses, or proposed hypothesis, are ultimately
reliant on the accuracy of the EFW data. Future researchers could incorporate
alternative datasets related to test the findings of this chapter.
4 Data findings
The Fraser Institute’s EFW dataset (Lawson and Murphy, 2023) is used to find
and compare the overall EFW scores of Botswana, sub-Saharan Africa, and the
World, and their scores for each of the five major areas of economic freedom, for
every year in which data are available. Unless specified, the earliest and most
recent EFW data available is used.2
Figure 5.1 shows the average overall EFW score for Botswana, SSA, and the
World. Notably, there is no data for Botswana in 1970, or from SSA or the World
before 1970.3 Figure 5.1 highlights that in the decades following independence,
Botswana steadily became more economically liberal with no significant declines.
To a large degree, this upward trend highlights the continuity and stability of
Botswana’s economic policies after independence. The most significant increases
2 These averages should be used with caution. Given the recent changes in the sources of the
EFW data, the data available for various jurisdictions have changed over time, meaning aver-
ages from one year may not be directly comparable to other years. At best, these averages pro-
vide an approximate measure of patterns over time.
3 Scores between 1950 and 1965 are an extension of the regular index using a smaller number of
variables. For more information, please see Lawson and Murphy, 2019.

Figure 5.1: Overall score for economic freedom for Botswana,

sub-Saharan Africa, and the World, 1950–2021
10
Overall score on EFW index

7
6 World Botswana
4 sub-Saharan Africa
3
0
1950 1960 1970 1980 1990 2000 2010 2020
Source: Gwartney, Lawson, and Murphy, 2023.
occurred between 1985 and 2005, where the nation experienced a rise in its EFW
score of 1.5 points. Since the mid-2000s there has been relative stagnation and in
2021 Botswana achieved a score of 6.84—only 0.09 points higher than where it
was in 2005, and 0.09 lower than its highest score of 6.93 in 2016.
Figure 5.2 shows the average score for EFW Area 2. Legal Systems and Property
Rights for Botswana, SSA, and the World. These data show that in the latter half
of the twentieth century, Botswana had consistently stronger property rights and
legal systems than the SSA average, and marginally higher than the world average.
Botswana’s rapid improvement between 2004 and 2005 was largely due to
substantial increases in the “gender disparity index” component of this area, indi-
cating greater equality between the sexes. Interestingly, if the gender adjustment
is removed, there is a marginal decline in this area of 0.01 points between 2004
and 2005. Similarly, without the gender adjustment, Botswana’s legal systems and
property rights would have peaked at 7.80 in 1995, and stand at just 6.28 today.
Figure 5.2: Score for Area 2: Legal System and Property Rights, with gender
adjustment, for Botswana, sub-Saharan Africa, and the World, 1970–2021
10
Score for Legal System and Property Rights
7 Botswana
6
World
5
4 sub-Saharan Africa
0 1970 1980 1990 2000 2010 2020


Despite its place above the SSA average in 1970, Botswana was far from excep-
tional in this component. Since 1970, Botswana has achieved an average rank of
just 5th in this area compared to all other SSA states.
Figure 5.3 shows the average score for EFW Area 1. Size of Government for
Botswana, SSA, and the World. The year 1970 was removed as data for Botswana
in this year were only available for three of the areas’ seven components.
These data show that in most of the years analyzed, Botswana’s score for Size
of Government was usually lower than the SSA and global average, and the nation
only scored comparatively higher (meaning it had a less intrusive government)
between 1975 and 1980 and briefly in 2012 and 2013. The component within this
area that attributes most to Botswana’s relatively low score is 1A: Government
Consumption, where the nation usually scores a 0 out of 10 and has averaged just
1.18 in this variable since 1975. Conversely, in the three variables related to income
and payroll taxes,4 from 2000 onwards Botswana scored extremely high with an
average score of 9 between 2000 and 2021.
Figure 5.3: Score for Area 1: Size of Government, for Botswana, sub-Saharan
Africa, and the World, 1975–2021
10
8
Score for Size of Government
sub-Saharan Africa
7 World
6
Botswana
5
0 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Figure 5.4 shows the average score for EFW Area 4. Freedom to Trade Internationally
for Botswana, SSA, and the World. These data show that since 1980 Botswana has
scored (aside from in 1995) above the SSA average, but since 2000 usually below
the global average. Unlike other areas, substantial liberalization occurred in this
area between 1975 and 1980. Over the time series, Botswana has steadily improved
in most variables. However, liberalization in the component 4D. Controls on the
Movement of Capital and People and subcomponent 4D(i). Financial Openness
were the most substantial. Conversely, the Subcomponents 4A(i). Trade Tax
Revenue and 4D(iv). Protection of Foreign Assets has remained consistently poor.
Figure 5.5 shows the average score Area 3. Sound Money for Botswana, SSA,
and the World. The year 1970 was removed from this analysis as for this year data
for Botswana were only available for two of the four components. These data
4 Namely: Component 1D. Top Marginal Tax Rate; Subcomponent 1D(i). Top Marginal Income
Tax Rate; and Subcomponent 1D(ii). Top Marginal Income and Payroll Tax Rates.

Figure 5.4: Score for Area 4: Freedom to Trade Internationally, for Botswana,
sub-Saharan Africa, and the World, 1975–2021
10
Score for Freedom to Trade Internationally

8
World
7 Botswana
6
sub-Saharan Africa
5
0 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Figure 5.5: Score for Area 3: Sound Money, for Botswana, sub-Saharan
Africa, and the World, 1975–2021
10
Botswana
9
8
Score for Sound Money
7 World
sub-Saharan Africa
6
0 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
show that Botswana usually scored significantly above the SSA average and mar-
ginally above the global average between 1990-2021. As with Area 4. Freedom
to Trade Internationally, two significant periods of liberalization occurred in this
area, between 1975 and 1980 and 1990 and 2000. However, it was not until 2000
that Botswana consistently outperformed the global average. The primary rea-
son for Botswana’s rapid improvement in this area in the 1990s was Component
3D. Foreign Currency Bank Accounts, which was greatly liberalized, going from a
score of zero between 1975 and 1990, to a score of 5 in 1995, and then 10 since 2000.
Figure 5.6 shows the average score for Area 5. Regulation for Botswana, SSA,
and the World. Interestingly, Regulation is the only area in which Botswana con-
sistently scored significantly higher than the global and SSA averages between
1975 and 1995. However, the sharp decline in Botswana’s score in this area in 2000
was primarily due to the data for ten more components (mostly surrounding labor

Figure 5.6: Score for Area 5: Regulation, for Botswana, sub-Saharan Africa,
and the World, 1975–2021
10
7 Botswana
Score for Regulation 6

World
5
sub-Saharan Africa
4
0 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
markets and the hiring and firing of workers, where the nation scores relatively
poorly) becoming available and being incorporated into its score. Throughout the
time series Botswana consistently scores high in Component 5A. Credit Market
Regulation and Subcomponent 5B(iv). Conscription.
Tables 5.1a and 5.1b list the top 10 freest economies in sub-Saharan Africa from
1975 to 2020 in five-year intervals. This table demonstrates that, although Botswana
was never once the freest nation in in sub-Saharan Africa (which since 1975 has been
the world’s least free region), it is the only nation always listed among the region’s
top 10 freest economies. This indicates that the stability of Botswana’s liberalism,
rather than its extent, is the unique factor in the nation’s economic policies (though
notably, Mauritius features on this list since 1980 and has been the freest African
nation since 1985). Tables 5.1a and 5.1b also demonstrate that, while significant lib-
eralization took place between 1985 and 2005, since 2010 Botswana has become
comparatively less free compared to the other most economically liberal SSA states.
5 Data and historical analysis

In this section, the inferences and expected outcomes of each hypothesis are pro-
posed and analyzed against the EFW data to determine whether the expected
causal mechanisms had an observable effect. Historical analysis will then seek
to explain the likely reasons that each hypothesis’s outcomes were or were not
reflected in the empirical data.
Hypothesis A British benign neglect preserved good pre-colonial institutions

Data analysis of Hypothesis A
If Hypothesis A is true, the expected outcomes within the empirical evidence
would be for Botswana to score highly on metrics related to size of government
(measured in figure 5.3) and strong legal systems and property rights (measured in
figure 5.2). Furthermore, if traditional institutions continued after independence
and a culture of property rights provided the state’s foundation, good scores in
these metrics should be evident soon after independence.

Table 5.1a: Top 10 freest economies by overall EFW score in Sub-Saharan Africa, 1975–1995
Rank 1975 1980 1985 1990 1995
1st Niger 5.98 Niger 5.73 Mauritius 6.59 Mauritius 6.39 Mauritius 7.5
2nd South Africa 5.64 Botswana 5.70 Niger 6.19 Mali 6.07 South Africa 6.83
3rd Senegal 5.33 Mali 5.65 Côte d’Ivoire 5.68 Botswana 5.95 Botswana 6.18
4th Botswana 5.22 Senegal 5.58 Mali 5.63 South Africa 5.66 Namibia 6.06
5th Mauritius 5.13 South Africa 5.34 Senegal 5.53 Senegal 5.62 Mali 5.67
6th Mali 5.00 Mauritius 5.31 Botswana 5.5 Gabon 5.57 Tanzania 5.67
7th Chad 4.99 Côte d’Ivoire 5.19 South Africa 5.44 Namibia 5.54 Zimbabwe 5.67
8th Cameroon 4.88 Zimbabwe 4.89 Togo 5.42 Togo 5.51 Kenya 5.44
9th Kenya 4.82 Cameroon 4.72 Chad 5.36 Chad 5.38 Congo, Rep. 5.3
10th Benin 4.61 Chad 4.7 Rwanda 5.13 Niger 5.38 Uganda 5.3
Table 5.1b: Top 10 freest economies by overall EFW score in Sub-Saharan Africa, 2000–2020
Rank 2000 2005 2010 2015 2020
1st Mauritius 7.47 Mauritius 7.65 Mauritius 8.11 Mauritius 8.09 Mauritius 7.89
2nd South Africa 6.97 South Africa 6.99 Uganda 6.98 Seychelles 7.57 Cabo Verde 7.44
3rd Uganda 6.63 Kenya 6.89 South Africa 6.88 Cabo Verde 7.14 Gambia, The 7.22
4th Botswana 6.44 Botswana 6.75 Ghana 6.8 Gambia, The 7 Seychelles 7.16
5th Zambia 6.28 Uganda 6.68 Kenya 6.8 Uganda 6.98 Uganda 6.88
6th Tanzania 6.17 Ghana 6.36 Zambia 6.8 Rwanda 6.97 Botswana 6.81
7th Kenya 6.09 Zambia 6.34 Rwanda 6.79 Botswana 6.92 Rwanda 6.75
8th Namibia 6.04 Namibia 6.3 Gambia, The 6.67 Kenya 6.85 Kenya 6.68
9th Mali 5.88 Tanzania 6.01 Botswana 6.57 South Africa 6.82 South Africa 6.5
10th Senegal 5.88 Côte d'Ivoire 5.99 Tanzania 6.51 Tanzania 6.64 Ghana 6.43

Figure 5.2 shows that in the area of Legal Systems and Property Rights, while
Botswana scored above the SSA average from 1970 onwards, in 1970 Botswana
was ranked just 6th in SSA. Although not a relatively low score, these findings sug-
gest Botswana did not have a tradition of uniquely good property rights that were
sustained after independence. Indeed, in this area, across the entire time series
analysed (1970–2020), when ranked against all SSA states, Botswana achieved an
average of just 5th place.
Figure 5.3 shows that in the area of Size of Government, Botswana usually
scored below the SSA and global average. One interpretation of the data in figure
5.3 could be that in 1975 and 1980, given the nation scored marginally higher than
the SSA and world average, Botswana had a good unintrusive government thanks
to the legacy of constrained inclusive pre-colonial institutions, but these institu-
tions were not maintained well following independence. However, this analysis
would be incomplete considering that in Size of Government, compared to the
35 SSA nations for which data are available, Botswana ranked 18th in 1975 and 19th
in 1980. While this ranking was not the lowest in the region, it certainly indicates
the government of Botswana was far from constrained and, if the elite’s power was
traditionally constrained, then this did not continue post-independence.
Similarly, Botswana’s steady increases in overall EFW (figure 5.1) in the
decades after independence, and especially between 1985 and 2005, indicates
that policy decisions unrelated to either the institutions in place immediately after
independence, or the role played by the nation’s first government, were significant
in increasing the nation’s degree of liberalism.
Ultimately, the mechanisms through which supporters of Hypothesis A claim
Botswana adopted liberal policies after independence are proven predominantly
insufficient when analyzed against the empirical data.
Historical analysis of Hypothesis A

Several historical misconceptions may help to explain why Hypothesis A largely
fails to stand up to scrutiny when examined against the empirical data. First, tra-
ditional kgotlas were likely not as inclusive as they are presented in the main-
stream literature. While it is argued that consensus among participants was
sought (Seidler, 2010: 26), in reality the chiefs had the ultimate say on all deci-
sions. Mgadla (1998) has noted that only a limited number of state matters were
discussed at these meetings, with most decisions being made by the elite behind
closed doors. The kgotlas experienced low levels of participation as they excluded
females, males under the age of 30, and, since they did not have “commoner
status”, minorities typically did not engage in discussion (Molutsi and Holm,
1990: 325). Given these factors, Swatuk proposes that, although kgotla’s provide
the “illusion of inclusion and open expression”, ultimately, the agenda was “set
and key decisions … taken by the ruling class” (2005: 109).
The elitist nature of the kgotla’s has led several authors, most notably Cook
and Sarkin to suggest Botswana should be noted for its historically high levels of
social control possessed by the ruling elite, and that the “system contains political
practices and laws that are decidedly undemocratic” (2010: 474). Indeed, even
today, a significant amount of power lies with the nation’s President, who has
unrestrained powers over laws, can withhold the signing of bills; controls the
police and information and broadcasting sector (Good, 2010: 2003); is the com-
mander-in-chief of the armed forces; and appoints all ministers. Interestingly, if

power is relatively concentrated with the elite and policy decisions do not involve
as much public participation as claimed in the existing literature, this lends cre-
dence to Hypothesis C, which suggests good leadership decisions are of first-order
importance in determining the degree of Botswana’s economically liberal policies.
Second, in Tswana societies, male household heads were given private
user-specific property rights to residential plots, the arable fields surrounding
each village, and grazing plots further away. However, these communal lands and
water resources were ultimately owned and held in trust by the chiefs. Therefore,
instead of a strong tradition of property rights, Tswana societies had extensive
communal property-rights regimes whereby the chiefs decided who had the
right to use which resources (Hillbom, 2014: 169). This power meant that chiefs
could divide resources based on political favor and patronage. An example of
rent-seeking by the elite can be seen in the late 1920s, when Chief Isang of the
BaKgatla tribe used native funds to launch water-development schemes. As Peters
(1994: 58) notes, the new boreholes were primarily given to syndicates made up
of the tribal elite or directly to elite individuals, which allowed them indirect con-
trol of parts of the grazing range.
Third, during the British involvement with the traditional institutions in the
colonial era, there was a significant strengthening of the chiefs’ power over their
people. Lewis suggests that, by working directly with colonial district commis-
sioners, the chiefs used their position “to be rent-seekers” (2006: 7). An example
of this rent-seeking can be seen when, from the 1930s, the British began to invest
further in the protectorates cattle sector through borehole drilling schemes. Once
built, these boreholes were then handed over to “a limited number of relatively
influential and wealthy members of Tswana society” (Hillbom, 2014: 165–166).
Given the distance between boreholes (8km) and the limited distance cattle can
walk before needing a drink (5km), boreholes indirectly gave their owners control
of the surrounding grazing range (Peters, 1994). Similarly, veterinary fences and
an abattoir were also built and given to the Tswana elite by the British.
British involvement, coupled with domestic practices, led to what Cooper has
dubbed a “gate-keeping state” (2002) and in the fifty years following the 1930s, the
proportion of the rural population not owning cattle more than tripled (Arntzen
and Silitshena, 1989; Hesselberg, 1985: 182).
Fourth, there are several examples of British intervention that cannot be con-
sidered benign. The 1899 policy, commonly dubbed the “hut tax”, required all
Botswana families who owned a hut to pay an annual tax of one pound. Schapera
(1947: 32) estimated that in 1943, as a result of the tax’s unaffordability, almost
half of the nation’s men between 15 and 45 years had to work abroad (usually in
South African mines) for 9-to-11 months per year. As a result, the economy suffered
severely and generations of children were raised without a father present. Other
examples of British intervention that cannot be considered benign include: when
the British directly replaced the dissident chiefs of the Kwena in 1906 and of the
Tawena tribes in 1931; after 1934, when Britain attempted to combine Bechuanaland
with South Africa; and in 1948 when the British banned chief Seretse Khama from
Bechuanaland following his marriage to Ruth Williams, a white Englishwoman.
Hypothetically, if Botswana’s success was largely the result of good preco-
lonial institutions that were untouched by the British, this hypothesis also fails
to explain why the region was not economically liberal nor successful before
or during British rule. Ultimately, the historical analysis demonstrates that the

kgotlas were not as inclusive as usually presented in the academic literature and
they became more authoritarian in the colonial era. Similarly, traditional property
rights were not fundamentally private, and rent-seeking by the elite within the
cattle sector did occur. These factors, coupled with the data analysis, show that
British benign neglect combined with good precolonial institutions cannot be
considered the primary drivers of Botswana’s contemporary economic liberalism.
Hypothesis B The British left good institutions

Data analysis of Hypothesis B
If the inferences of Hypothesis B were valid, we would expect to find fairly good
overall EFW scores (figure 5.1) prior to independence. Similarly, given that advo-
cates of Hypothesis B propose that Botswana sustained Britain’s inclusive insti-
tutions and good laws, we would expect the nation to score well in the areas of
Legal Systems & Property Rights (figure 5.2) and Size of Government (figure 5.3),
especially soon after independence.
The basis of Hypothesis B rests on the claim that British institutions in Botswana
were good. However, within the empirical data, the fact that Botswana’s overall
EFW score was lower in 1960, when the British formally ruled the colony, than the
SSA average in 1970 seems to undermine the proposed benefits of British institu-
tions in the protectorate. The notion that Botswana “sustained the minimal public
service structure it inherited from the British” (Acemoglu, Johnson, and Robinson,
2003) also seems unlikely considering that, for Area 1. Size of Government,
Botswana ranked just 18th when compared to all other SSA states in 1975.
Hypothetically, scholars could argue that Botswana had marginally higher
scores in Legal Systems & Property Rights (figure 5.2) than the SSA and global
average between 1970 and 1995 because they inherited and maintained good
British institutions. While this analysis could be true, it does little to explain why
Botswana declined in this area after 1995 before making gains following 2004.
This fluctuation indicates policy decisions were of greater importance.
Ultimately, while Hypothesis B is not entirely irrelevant and could have pro-
vided an explanation for the foundation through which good institutions and poli-
cies were improved, it provides an insufficient explanation of the mechanisms that
caused Botswana’s steady but substantial increases in liberalism.
Historical analysis of Hypothesis B

Several theoretical and historical factors help explain the predominantly inconclu-
sive outcomes of Hypothesis B within the empirical data. Botswana’s status as a
former British colony is partially reflected in its Westminster Parliamentary System
and its Western system of law that can be described as Dutch-Roman, but with sig-
nificant elements of British common law (Beaulier, 2005: 7). However, suppose
the inheritance of good British institutions were sufficient in ensuring the imple-
mentation of liberal policies and subsequent economic growth. In that case, this
claim fails to explain why these outcomes have not occurred in many other former
British colonies, such as Zimbabwe or Zambia, if decisions to keep such institu-
tions were not of first-order importance. Furthermore, in analyzing the growth
rate of former British and French colonies between 1970 and 2003, Beaulier and
Subrick found the results did “not indicate a difference in growth rates” (2006:
106). Therefore, it is probable that Botswana’s status as a British colony is insuffi-
cient to explain the nation’s economic growth and institutional strength.

To explain why some British institutions took hold in Botswana and not in
the empire’s other former colonies, two primary hypotheses have been put forth.
First, Seidler notes that Botswana modified the Westminster model to “fit Tswana
culture” (2010: 26) so that significantly more power lies with the President.
Similarly, on the local level, chiefs maintain important judicial powers and pre-
side over customary courts, meaning traditional law remains practiced through
civil law. Second, Beaulier proposes Botswana maintained decent foundational
British laws and institutions because “unlike most African countries, Botswana
did not call into question” every element of British common-law and the govern-
ment of Botswana chose to keep some important aspects (2005: 7).
While it is beyond the scope of this article to determine the validity of these
two claims, if they are correct this would indicate that good decisions regarding
institutions and policy made after independence were of first-order importance,
rather than pre-existence of these institutions alone.
Hypothesis C Good leadership

Data analysis of Hypothesis C
Hypothesis C suggests good leadership and decisions rather than historical factors
were the primary reason for Botswana’s liberal policies. If this theory is correct, we
would expect to find low to moderate levels of liberalism before independence and
far greater levels of liberalism, especially when compared to the SSA average, after
independence. As Beaulier (2003, 2005) emphasizes the importance of liberal pol-
icy choices immediately after independence, we would also expect to see a high
score in overall EFW in 1975 (the first data available for an independent Botswana).
Figure 5.1 shows that Botswana’s overall level of economic freedom was moder-
ately low between 1950 and 1965 and increased steadily in the decades after indepen-
dence until about 2005. To a degree, this indicates that the outcomes expected with
Hypothesis C are observable in the data findings, namely, Botswana was not partic-
ularly economically liberal pre-independence, and it was the decisions made by the
government of Botswana after 1966 that led to higher levels of economic liberalism.
However, while figures 5.1, 5.2, 5.4, and 5.5 that show Botswana drastically
improved across nearly all metrics of economic freedom in the decades after inde-
pendence, there is little evidence that President Khama implemented pro-market
reforms on a wide front and “liberalized trade … and kept marginal income tax
rates low” immediately after independence (Beaulier, 2003: 236). In the area of
freedom to trade internationally (figure 5.4), Botswana scored just 2.46 in 1975,
meaning it ranked 16th out of the 24 SSA nations for which data are available.
Similarly, in the same year, Botswana scored a zero for top marginal income tax
rate and top marginal tax rate. Given that substantial liberalization took place
decades after independence and indeed, after Khama’s death in 1980, this indi-
cates the extent of Botswana’s liberalism cannot solely be credited to Khama’s
administration immediately after independence. This being the case, Beaulier’s
(2003) emphasis on the value of Khama’s liberal policies immediately after inde-
pendence should be removed, and the importance of good decisions by post-in-
dependence leadership more broadly, should be emphasized.
Historical analysis of Hypothesis C

Given that the alternative Hypothesis D builds upon Hypothesis C, the historical
analysis of this theory is integrated into its analysis below.

6 New hypothesis—the role of stability

and good decisions
Theoretical arguments of the new Hypothesis D

Hypothesis C demonstrates that the decisions by the government of Botswana
are a necessary variable for explaining why Botswana became economically
liberal. However, this explanation does not provide a holistic account of how
or why successive governments implemented liberal policies over several
decades. To overcome this problem, Hypothesis D proposes that the stability
of the Botswanan state is the primary mechanism that explains “how” good
liberal policies were implemented over the decades in Botswana. In addition,
while good leadership did play a role, there were a range of significant external
and internal constraints that limited the Overton window through which pol-
icy decisions could be made. These constraints mean “good decisions”, rather
than “good leadership” alone, more adequately explains why Botswana’s liberal
policies were introduced.
Importance and evidence of stability

Many academic works indicate the positive relationship between stability and
better policies, and economic growth. First, Olson (1993) found that stability
during transitions of power and a consensus among the citizenry for their rulers
results in governments that are more likely to prioritise long-term development
rather than act as a “revolving bandit” that pillages the nation’s wealth. Similarly,
Grossman (2000) suggests greater political stability and the lower likelihood of
revolution lead to governments that are less likely to adopt predatory extractive
policies, especially regarding natural resources.
Second, as Pritchett and De Weijer (2010: 2) point out, if fragile states move
too quickly to implement good policies, it risks undermining already limited state
capability. Being unable to enforce better laws often leads to worse economic out-
comes than if no intervention happened in the first place (Pritchett and De Weijer,
2010: 33). Instead, Pritchett and others, such as Grindle (2004), suggest sustained
economic growth must rely on incrementally implementing good policies, which
are fundamentally underpinned by governmental stability. As seen in the steady
rise of economically free policies in the decades after independence, this almost
certainly occurred in Botswana.
Third, the main political opponents to the Botswana Democratic Party for the
first three decades of independence were socialist parties who were economi-
cally nationalist and desired to nationalize land and industry. For this reason, it
is improbable that the extent of Botswana’s liberalism today could be achieved
without the stability of the BDP, especially between 1966 and 2005, when the
most liberalization took place.
Stability in the decades after independence in Botswana is visible in various
areas. Despite the 80 successful coup d’états, 108 failed coup attempts, and 139
coup plots across 48 independent countries of sub-Saharan African between
1956 and 2001 (McGowan, 2003: 340), Botswana has never had one. Similarly,
Botswana has only ever had peaceful transfers of power, and the BDP has won
every election since 1965. The EFW data (tables 5.1a and 5.1b) also highlight
a regionally unrivalled degree of stability in the continued maintenance and
improvement of economically liberal policies.

Reasons for stability

Many factors may explain Botswana’s relative stability in the decades after inde-
pendence. First, with 79% of the population identifying as Tswana (CIA World
Factbook, 2023), Botswana is relatively homogenous. While Schapera (1952) and
Parsons (1999) found that only around 50% of Botswana’s population are genet-
ically Tswana, Robinson (2009: 9) and Seidler (2010: 29) suggest this homoge-
neity helped ensure more aligned political beliefs, less conflict, and greater trust
after independence. However, homogeneity should only be considered one of
several factors underlying Botswana’s stability, not a singular explanation for the
nation’s success. After all, Lesotho is more homogeneous than Botswana (98%
identify as Basotho) and has a linguistic, cultural, and institutional inheritance
similar to that of Botswana (Acemoglu, Johnson, and Robinson, 2003: 107), yet
it is not nearly as stable or economically liberal.
Another reason for Botswana’s stability could be the interconnectedness of the
elite. Many members of the first cabinet were educated at Tiger Kloof Educational
Institute, most came from families with cattle wealth, most sat on the British African
Advisory Council of Bechuanaland, and later the Legislative Council, and the major-
ity were actively involved in drafting the BDP’s constitution, working together as
early as 1961. To put into perspective the interconnectedness of the nation’s rulers,
after Khama died in 1980, Quett Masire, who had been vice-president since 1966,
became president until 1998. The country’s fourth president, who served between
2008 and 2018, was Ian Khama, the son of Seretse Khama. The current president,
Mokgweetsi Masisi, is the son of Edison Masisi, a member of parliament between
1966 and 1999, who attended Tiger Kloof with Masire. This interconnectedness is
not surprising considering that at independence, the nation had just 22 university
graduates, most of whom were actively involved in the first government. However,
more surprising is the ideological consistency of the first cabinet: none were fol-
lowers of South African nationalist movements, none were economically nation-
alist in their outlook, and they encouraged multiracialism.
The hereditary significance and ideological leaning of BDP leaders also likely
helped with stability. While Khama was chief of the Bamangwato, and other
BDP leaders had hereditary ties, the rival party at the time of independence, the
Botswana People’s Party (BPP), comprised commoners who actively called for
the end of hereditary rule. As Selolwane (2002: 71) notes, this message largely
failed to resonate with the citizenry. Polhemus (1983: 405) also suggests that the
BPP failed to attract support from the tribal elite as it portrayed itself as a social-
ist party intent on nationalizing land, resources, and all industries. The Botswana
National Front (BNF) faced a similar problem because, until the mid-1990s, they
were also a socialist party intent on abolishing private land tenure. As the tradi-
tional elite was centralised within the BDP, this could have reduced the chance
of civil war, coups, and instability.
This chapter does not argue that the political dominance of an interconnected
elite is beneficial for nations. Instead, in the case-specific example of Botswana, it
likely led to a greater level of stability and liberalism than would otherwise be the
case, given the socialist inclinations of alternative political parties.
Constraints on leadership that fostered better policies and stability

A potential criticism of Hypothesis D could be that, if the elite were stable and had
significant power, why did Botswana not descend into a kleptocratic oligarchy?

To answer this, it is worth considering the important constraints on the elite’s

decision-making in the first few decades after independence.
First, for 11 years of independence, Botswana had no army. Yet, between 1966
and 1980, and even until the early 1990s in the case of South Africa, Botswana
was surrounded (apart from a 135-metre border with Zambia) by white-ruled
states who were openly hostile to African-majority rule. This meant the gov-
ernment of Botswana was discouraged from embracing radical communist and
racialist policies. Had they done so, the likelihood of attacks, economic isola-
tion (a significant threat given the elite’s cattle-trading interests), or even inva-
sion from South Africa, would have been significantly higher. After all, despite
UN objections, Namibia was ruled by South Africa until 1990, and Dale (1987:
77) has highlighted the legitimate fear within the government of Botswana of a
possible invasion.
Not having an army also reduced the chance that a political opponent, or
ambitious general, could take over the military and attempt a coup. Similarly,
a lack of an army and a minimal police force meant that the government of
Botswana had to maintain strong electoral support, as the effectiveness of any
revolution from a dissatisfied populace would be greater. Finally, as Gupta, de
Mello, and Sharan (2001: 751–753) propose, a lack of an army also reduces the
likelihood of corruption. Although an army was created in 1977, the force’s
spending was minimal.
Second, Botswana’s economy was in a precarious situation at the time of
independence and in the years following. Botswana relied on the British exche-
quer and foreign aid, and later on diamond revenues, to fund basic governmental
expenditure. If the Botswanan elite implemented far-left policies, it would have
likely significantly reduced the funds the protectorate received from the British,
the International Monetary Fund, the World Bank, and given their stance that
nationalist movements would only benefit from their development assistance
if they guaranteed capitalist policies, the United States too (Selolwane, 2002:
74–75). Similarly, as Botswana relied on diamond revenues, the nation’s success
was tied to De Beers. If bad policy decisions had been made and De Beers did
not initially invest in the country, it would have been an economic catastrophe
for Botswana.
Historical analysis of Hypothesis D

Undoubtedly, the post-independence Batswana leadership had several benefi-
cial qualities from an economically liberal and human-rights perspective. While
Hypothesis D acknowledges the merits of the good-leadership explanation
implicit in Hypothesis C, it suggests the important external constraints on the
elite’s decision-making after independence help provide a more accurate account
as to why liberal policies were introduced.
Good decision-making and external constraints can intertwine. For example,
after independence, Khama made good decisions to retain British civil servants
until the local population could replace them and invited the white community
into the BDP (and even gave them cabinet roles). While these decisions likely
reflected Khama’s personal beliefs, he was relatively constrained in these choices.
If Khama expelled the white population, it would have likely undermined De
Beers’ confidence in the country, reduced the trade in the beef between Botswana

and the United Kingdom (and other neighboring states) upon which the elite
was economically dependent, and antagonized white-ruled South Africa and
Rhodesia, which could threaten geo-security.
Hypothesis D’s validity and the important role of external constraints on the
elite’s decision-making is further strengthened when we consider, as outlined
in the historical analysis of Hypothesis A, that the elite did engage in significant
rent-seeking behavior within the cattle industry when there were no clear adverse
consequences for them to do so. Hypothesis C’s insistence just on good leadership
cannot explain this rent-seeking.
While it was a good decision of the Batswana elite not to personally bene-
fit from, or nationalize, diamond mines, a degree of luck and other constraints
played a role in this decision. First, it is fortunate that diamonds were only found
after independence, meaning the ruling elite had no incentive to go into politics
to plunder these resources. Instead, for most political elites, protecting their
cattle interests was paramount. Second, as Botswana’s diamonds are found in
a kimberlite matrix, they require huge amounts of capital and skill to extract
successfully, meaning external assistance was needed. The first diamond mine
in Orapa, for example, was funded by De Beers at the cost of 26 million rand
(US$36 million; Silitshena, 1978: 46), equal to one third of Botswana’s GDP in
1971 (World Bank, 2023b).
Ultimately, good decisions influenced by external constraints helps to explain
why Botswana’s liberal policies were introduced. However, given the time frame
over which these policies were implemented, the stability of the government of
Botswana and the nation as a whole provided the basis from which these policies
could be implemented.
Data analysis of Hypothesis D

As the empirical EFW data, historical factors, and the chronology of Botswana’s
liberal policies provided the foundation for Hypothesis D, the expected outcomes
of these proposed causal mechanisms align with the EFW data. Namely, stability
(be it ideological, political, militaristic or economic) allowed the government of
Botswana to steadily increase economic freedom, thanks to good (albeit perhaps
constrained) decisions.
Across nearly all areas of economic freedom, Botswana steadily became more
liberal in the decades following independence. While a sizeable increase in eco-
nomic freedom occurred between 1985 and 2005, this process represented an
acceleration of existing trends and was fundamentally possible as a result of the
stability of the Botswana Democratic Party.
Botswana’s stability and incremental improvements in liberalism are
reflected in figure 5.1, which demonstrates that Botswana is the only nation in
sub-Saharan Africa to remain in the top 10 freest economies in sub-Saharan Africa
from 1975 to 2020. While many African nations briefly embraced economic lib-
eralism before later embracing nationalist policies associated with the various
forms of “African Socialism”, a significant shift in policy or ideology within
the government of Botswana never occurred. Ultimately, it is only when com-
bined that the explanations from stability and constrained good decision-mak-
ing provide a necessary and sufficient account of the observed outcomes in the
empirical data.

7 Contemporary analysis
The findings of this chapter could have immense significance for Botswana’s
future. Namely, the factors that promoted stability and those that constrained
the Overton window of leadership decision-making in the decades after indepen-
dence have become increasingly insignificant. Some examples of the unravelling
of these constraints include the following.
1. With tens of billions of dollars already invested in Botswana and immense depen-
dence on the nation’s mines, it is extremely unlikely De Beers will pull out of the
nation in the coming decades. Indeed, in July 2023, De Beers and the government
of Botswana agreed that, among other things, the company would invest as much
as $825 million in the nation over the next ten years (Eligon, 2023). Before these
massive investments were made in the 1960s and 1970s, poor policy decisions may
have deterred De Beers, which the Botswanan economy could not afford.
2. Today, Botswana has mainland Africa’s highest GDP per capita (World Bank,
2023b). As such its economy is not reliant on foreign aid or, to a large degree, the
policy desires of the other nations. This means, where once infeasible, Botswanan
policy makers may decide the nation can “afford” to implement more protection-
ist policies. The recent ban on the importing some South African foodstuffs and
the new limitations on foreigners owning businesses in certain sectors may exem-
plify this phenomenon (The Economist, 2023).
3. The threat of invasion is now negligible.
4. Most of the Tswana leadership are no longer dependent on cattle (or another
external source) for their wealth and thus have no significant cattle-trading inter-
ests to protect.
Similarly, the factors that may have once promoted stability are also less preva-
lent today. First, the BDP’s vote share has declined from an average of 72.2% from
1965 to 1989 to 52.7% between 1994 and 2019. Indeed, in 2019, the main opposi-
tion party, the Umbrella for Democratic Change (UDC), which is an alliance of
Botswana’s predominantly center-left parties (including the BNF, BPP, Botswana
Congress Party, and Botswana Movement for Democracy), received a vote share
of 35.8%—the second largest for any opposition party in Botswana’s history,
despite being formed only seven years earlier (IFES, 2019). The increasing uncer-
tainty of success in the next election may play into Grossman’s (2000) theory that
less stable leaders are more likely to adopt extractive policies—especially if they
have no independent source of wealth outside of politics.
Furthermore, significant rifts among the Botswanan elite have occurred in
recent years. These disputes are perhaps best highlighted in the recent arrest war-
rant issued for former President Ian Khama, his self-exile in South Africa, Khama’s
claims that he has been the target of three attempted poisonings, and the govern-
ment of Botswana’s claim that Khama is trying to launch a coup (The Economist,
2023). After he left the BDP in 2019, Khama launched the Botswana Patriotic
Front and, although the party joined the UDC in 2022 (thus potentially increas-
ing the UDC’s vote share in the next election in 2024), it independently won
three seats in the 2019 election, all in the Khama family’s home region—further

indicating some possible regional splinters. Finally, at a comparatively high 2.9%,

Botswana’s military expenditure as a percentage of GDP is the joint third highest
in SSA (World Bank, 2023f ). Although a military-led coup is unlikely today, this
factor was not present in Botswana’s first 11 years of independence.
While Botswana has not declined precipitously in any area of the EFW data
in recent years, the nation’s economic freedom has largely stagnated or, in some
cases, marginally declined since 2005. Indeed, the nation’s overall EFW score in
2021 is 6.81, only slightly above its 2005 score of 6.71. Even more discouraging,
Botswana’s score in Legal Systems & Property Rights has steadily declined from
its peak of 6.37 in 2005 to just 5.91 in 2021. Similarly, for Size of Government the
nation reached a peak of 6.90 in 2012 and has declined by 0.52 points to 6.38
in 2021. However, despite this relative stagnation and, in some cases, marginal
declines there are increasingly worrying signs from the nation, in part due to
the unravelling of pre-existing constraints and stability that may undermine the
nation’s freer future.
For example, at the UN Human Rights Council’s Universal Periodic Review
(UPR), Botswana’s human-rights record was examined for the fourth time in May
2023 (the first, second, and third being in 2008, 2013, and 2018). The UN has crit-
icized the nation’s human-rights record, and more than 30 UN member states
made recommendations for how the nation can improve; many of these focused
on increasing freedom of expression, press freedom, and ensuring the protection
of opposition politicians, journalists, and activists. Judge Dumisa Ntsebeza of the
African Court on Human and Peoples’ Rights (an African Union body) and Cherie
Blair, a human rights lawyer, have stated Botswana was experiencing a “backslid-
ing on civil and political rights” that is leading to an “anti-democratic repression
and a rising tide of political persecution” (Ndebele, 2023).
The Southern Africa Litigation Centre has described governmental inter-
ference in civil and political rights as “profoundly alarming” (Ndebele, 2023).
Further, the US State Department identified many human-rights issues in its 2022
country report, which highlighted examples of the arbitrary arrest of opposition
political figures, and abuses committed by security forces, including dispersals
of peaceful protests (Bureau of Democracy, Human Rights, and Labor, 2023).
All of this led The Economist, in June 2023, to publish an article titled “Botswana,
an African Success Story, Looks Ever Less Exceptional”, in which they suggest
“Botswana is becoming more volatile, nationalist, populist—[and] no longer such
a rare gem” (The Economist, 2023).
This chapter has found that good, although often constrained, decisions by the
ruling elite, coupled with political and socio-economic stability, have been the
driving factor in the implementation of liberal policies in Botswana. While the
alarming stories coming from Botswana over recent years have yet to result in a
significant impact on their EFW score, the unravelling of the constraints that once
helped ensure good policy decisions, along with the stability that once under-
pinned them, is a concerning development. However, this chapter has shown that
fundamentally, policy choice rather than historical determinism is the origin of
Botswana’s economic success. For this reason, with the right policies going for-
ward, there is an opportunity for Botswana to transcend its current stagnation
and excel once again.

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Appendix Explanatory Notes and Data Sources
Area 1 Size of Government
A Government consumption
This component is measured as general government consumption spending as a
percentage of total consumption. The rating for this component, as with many
of the following components, is designed to mirror the actual distribution of the
raw data but on a 0-to-10 scale. The rating is equal to: (Vmax − Vi) / (Vmax − Vmin)
× 10. The Vi is the country’s actual government consumption as a proportion of
total consumption, while the Vmax and Vmin are set at 40% and 6%, respectively.
The 1990 data were used to derive the maximum and minimum values for this
component as well as most other components to follow. Countries with a larger
proportion of government expenditures receive lower ratings.
Sources World Bank, World Development Indicators; International Monetary Fund, Interna-
tional Financial Statistics; United Nations National Accounts.
B Transfers and subsidies

This component is measured as general government transfers and subsidies as
a share of GDP. The rating for this component is equal to: (Vmax − Vi) / (Vmax −
Vmin) × 10. The Vi is the country’s ratio of transfers and subsidies to GDP, while
the Vmax and Vmin values are set at 37.2% and 0.5%, respectively. The formula
will generate lower ratings for countries with larger transfer sectors. When the
size of a country’s transfer sector approaches that of the country with the larg-
est transfer sector during the 1990 benchmark year, the rating of the country
will approach 0.
Sources International Monetary Fund, Government Finance Statistics Yearbook; World Bank,
World Development Indicators; International Monetary Fund, International Finan-
cial Statistics; United Nations National Accounts.
C Government investment
Data on government investment as a share of total investment are used to con-
struct the 0-to-10 ratings. Countries with more government investment as a share
of total investment receive lower ratings. The rating for this component is equal to:
(Vmax − Vi) / (Vmax − Vmin) × 10. The Vi is the country’s ratio of transfers and sub-
sidies to GDP, while the Vmax and Vmin values are set at 50% and 15%, respectively.
Sources International Monetary Fund, Investment and Capital Stock Dataset; World Bank,
World Development Indicators; Organisation for Economic Co-operation and
Development, OECD Data.

D Top marginal tax rate

i Top marginal income tax rate
Countries with higher marginal tax rates that take effect at lower income thresh-
olds received lower ratings based on the matrix below. The income threshold data
are converted from local currency to 1983 US dollars (using exchange rates and the
US Consumer Price Index). These figures include sub-national rates if applicable.
ii Top marginal income and payroll tax rates

Countries with higher marginal income and payroll (wage) tax rates that take
effect at lower income thresholds received lower ratings based on the matrix
below. The income threshold data are converted from local currency to 1983 US
dollars (using exchange rates and the US Consumer Price Index). These figures
include sub-national rates if applicable.
Sources PricewaterhouseCoopers, Worldwide Tax Summaries Online; Pricewaterhouse
Coopers, Individual Taxes: A Worldwide Summary (various issues); Ernst & Young,
Worldwide Personal Tax and Immigration Guide (various issues); Deloitte Interna-
tional Tax Source, Guide to Fiscal Information: Key Economies in Africa (various issues).
Income Threshold at Which the Top Marginal

Rate Applies (1983 US$)
<$25,000 $25,000 – $50,000 – $150,000+
<$50,000 <$150,000
< 21% 10 10 10 10
21% – <26% 9 9 10 10
26% – <31% 8 8 9 9
Top Marginal Tax Rate
31% – <36% 7 7 8 9
36% – <41% 5 6 7 8
41% – <46% 4 5 6 7
46% – <51% 3 4 5 5
51% – <56% 2 3 4 4
56% – <61% 1 2 3 3
61% – <66% 0 1 2 2
66% – <70% 0 0 1 1
70%+ 0 0 0 0
E State ownership of assets

This component is based on ratings from the Varieties of Democracy (V-Dem) data
on State Ownership of the Economy, which “gauges the degree to which the state
owns and controls capital (including land) in the industrial, agricultural, and ser-
vice sectors. It does not measure the extent of government revenue and expendi-
ture as a share of total output; indeed, it is quite common for states with expansive
fiscal policies to exercise little direct control (and virtually no ownership) over
the economy”. We use the original scale (*osp) data from V-Dem for this variable
and for all V-Dem-based variables to follow. The rating is equal to: (Vi − Vmin) /
(Vmax − Vmin) × 10. The Vi is the country’s state ownership score, while the Vmax
and Vmin are set at 4.0 and 0, respectively. Countries with greater government
ownership of assets get lower scores.
Source V-Dem Institute, Varieties of Democracy, <www.v-dem.net>.

Appendix: Explanatory Notes and Data Sources • 251
Area 2 Legal System and Property Rights

Note The ratings for Area 2 are adjusted to reflect inequalities in the legal treatment
of women using a Gender Disparity Index (GDI) provided annually by Rose-
marie Fike. The primary data used in the GDI are from the World Bank’s Women,
Business and the Law reports. For additional details, see Rosemarie Fike (2018),
Impact of Economic Freedom and Women’s Well-Being, <https://www.fraserinstitute.
org/studies/impact-of-economic-freedom-and-womens-well-being>.
A Judicial independence
This component is based on three sources. (a) The first source of this com-
ponent is from the Global Competitiveness Report question: “Is the judiciary
in your country independent from political influences of members of govern-
ment, citizens, or firms? No—heavily influenced (= 1) or Yes—entirely inde-
pendent (= 7)”. The question’s wording has varied slightly over the years. All
variables from the Global Competitiveness Report were converted from the orig-
inal 1-to-7 scale to a 0-to–10 scale using this formula: EFWi = ((GCR i − 1) ÷
6) × 10. (b) The second source is a collection of questions from the V-Dem
dataset, namely: Judicial Purges, Government Attacks on the Judiciary, Court
Packing, High Court Independence, and Low Court Independence. Each of
the V-Dem variables is individually rated using the formula (Vi − Vmin) / (Vmax −
Vmin) × 10. The Vi is the country’s V-Dem score according to V-Dem. For Judicial
Purges, Government Attacks on the Judiciary, High Court Independence, and
Low Court Independence, Vmax and Vmin were set at 4.0 and 0, respectively.
For Court Packing, Vmax and Vmin were set at 3.0 and 0, respectively. All five
scores are then averaged. (c) The third data source is based on Update, A Global
Measure of Judicial Independence, 1900-2015 (Staton, Linzer, Reenock, and
Holsinger, 2019). This data source scores on a 0-to-1 scale, so it was multiplied
by 10 to place it on the scale of the other variables. The final rating is the aver-
age of whichever of these sources are available, and the data are chain-linked to
assure time consistency.
Source World Economic Forum, Global Competitiveness Report; V-Dem Institute, Varieties
of Democracy, <www.v-dem.net>; Jeffrey Staton, Drew Linzer, Christopher Ree-
nock, and Jordan Holsinger (2019), Update, A Global Measure of Judicial Indepen-
dence, 1900-2015 (Harvard Dataverse, V1), <https://doi.org/10.7910/DVN/NFXWUO>.
B Impartial courts
This component is based on four sources. (a) The first source is the Global
Competitiveness Report question: “The legal framework in your country for private
businesses to settle disputes and challenge the legality of government actions and/
or regulations is inefficient and subject to manipulation (= 1) or is efficient and fol-
lows a clear, neutral process (= 7)”. The question’s wording has varied slightly over
the years. (b) The second source of this component is Judicial Corrupt Decision
from the V-Dem dataset. The rating is equal to: (Vi − Vmin) / (Vmax − Vmin) × 10.
The Vi is the country’s Judicial Corrupt Decisions Score, while the Vmax and Vmin
are set at 4.0 and 0, respectively. (c) The third source is the Rule of Law indica-
tor found in the Worldwide Governance Indicators. The formula used to calculate
the 0-to-10 ratings is: (Vi − Vmin) / (Vmax − Vmin) × 10. Vi represents the com-
ponent value. The values for Vmax and Vmin are set at 2.5 and −2.5, respectively.
Countries with values outside the Vmax and Vmin range received ratings of either

0 or 10, accordingly. (d) The fourth source is the “Transparency and the fairness
of the legal system” indicator from the Economist Intelligence Unit (EIU). The
original scale is 1-to-5, so the rating formula for data from the EIU is: EFWi =
((EIUi − 1) ÷ 4) × 10. The final rating is the average of whichever of these sources
are available, and the data are chain-linked to assure time consistency.
Source World Economic Forum, Global Competitiveness Report; World Bank, Worldwide
Governance Indicators; V-Dem Institute, Varieties of Democracy, <www.v-dem.net>;
Economist Intelligence Unit, Business Environment Rankings.
C Property rights
This component is based on three sources. (a) The first source is the Global
Competitiveness Report question: “Property rights, including over financial assets,
are poorly defined and not protected by law (= 1) or are clearly defined and well
protected by law (= 7)”. (b) The second source is Property Rights and Rule-Based
Governance from Country Policy and Institutional Assessment (CPIA) data from
the World Bank. This has been scaled to the Legal System and Property Rights
data via regression. (c) The third source is the “Degree to which private property
rights are guaranteed and protected” indicator from the Economist Intelligence
Unit. The final rating is the average of whichever of these sources are available,
and the data are chain-linked to assure time consistency.
Source World Economic Forum, Global Competitiveness Report; World Bank, Country
Policy and Institutional Assessment; Economist Intelligence Unit, Business Envi-
ronment Rankings.
D Military interference
This component is based on the International Country Risk Guide Political Risk
Component G, Military in Politics: “A measure of the military’s involvement in
politics. Since the military is not elected, involvement, even at a peripheral level,
diminishes democratic accountability. Military involvement might stem from an
external or internal threat, be symptomatic of underlying difficulties, or be a full-
scale military takeover. Over the long term, a system of military government will
almost certainly diminish effective governmental functioning, become corrupt,
and create an uneasy environment for foreign businesses”. Originally on a 0-to-6
scale, the rating is algebraically converted to a 0-to-10 scale.
Sources PRS Group, International Country Risk Guide.
E Integrity of the legal system

This component is based on two sources. (a) The first source is the International
Country Risk Guide Political Risk Component I for Law and Order: “Two mea-
sures comprising one risk component. Each subcomponent equals half of the
total. The ‘law’ subcomponent assesses the strength and impartiality of the legal
system, and the ‘order’ subcomponent assesses popular observance of the law”.
Originally on a 0-to-6 scale, the rating is algebraically converted to a 0-to-10 scale.
(b) The second source is Judicial Accountability, Compliance with the High Court,
Judicial Review, Transparent Laws with Predictable Enforcement, and Access to
Justice for Men from the V-Dem dataset. (An adjustment for the area as a whole is
made later to account uniformly for gender disparities.) Each of the V-Dem vari-
ables is individually rated using the formula (Vi − Vmin) / (Vmax − Vmin) × 10. Vi is
the country’s V-Dem score according to V-Dem, and Vmax and Vmin are set at 4.0

and 0, respectively. The five measures from V-Dem are then averaged. The final
rating is the average of whichever of these sources are available, and the data are
chain-linked to assure time consistency.
Source PRS Group, International Country Risk Guide; V-Dem Institute, Varieties of Democ-
racy, <www.v-dem.net>.
F Contracts
This component is based on three sources. (a) The first source uses the World
Bank’s Doing Business estimates for the time and money required to collect a debt.
The debt is assumed to equal 200% of the country’s per-capita income where the
plaintiff has complied with the contract and judicial judgment is rendered in his
favor. 0-to-10 ratings are constructed for (1) the time cost (measured in number of
calendar days required from the moment the lawsuit is filed until payment); and
(2) the monetary cost of the case (measured as a percentage of the debt). These
two ratings are then averaged to arrive at the final rating for this component. The
formula used to calculate the 0-to-10 ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10.
Vi represents the time or money cost value. The values for Vmax and Vmin are set
at 725 days/82.3% and 62 days/0%, respectively. Countries with values outside
the range from Vmax to Vmin received ratings of either 0 or 10, accordingly. (b) The
second source is Enforcement of Contracts from the Historical Ratings Research
Package by Business Environment Risk Intelligence (BERI). The formula used to
calculate the 0-to-10 ratings is: (Vi − Vmin) / (Vmax − Vmin) × 10. Vi represents the
component value. The values for Vmax and Vmin are set at 4 and 0, which corre-
sponds to the range of the variable. (c) The third source is the “Efficiency of the
legal system” indicator from the Economist Intelligence Unit. The final rating is
the average of whichever of these sources are available, and the data are chain-
linked to assure time consistency.
Source World Bank, Doing Business; Business Environment Risk Intelligence, Historical
Ratings Research Package; Economist Intelligence Unit, Business Environment
Rankings.
G Real property
This component is based on the World Bank’s Doing Business data on the time
measured in days and monetary costs required to transfer ownership of property
that includes land and a warehouse. 0-to-10 ratings are constructed for (1) the
time cost (measured in the number of calendar days required to transfer owner-
ship); and (2) the monetary cost of transferring ownership (measured as a per-
centage of the property value). These two ratings are then averaged to arrive at
the final rating for this component. The formula used to calculate the 0-to-10
ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the time or money cost
value. The values for Vmax and Vmin are set at 265 days/15% and 0 days/0%, respec-
tively. Countries with values outside the range from Vmax to Vmin received ratings
of either 0 or 10, accordingly.
Source World Bank, Doing Business.
H Police and crime

This component is based on two sources. (a) The first source is the Global
Competitiveness Report question: “To what extent can police services be relied
upon to enforce law and order in your country? (1 = Cannot be relied upon at

all; 7 = Can be completely relied upon)”. (b) The second source is the “Impact
of crime” indicator from the Economist Intelligence Unit. The final rating is the
average of whichever of these sources are available, and the data are chain-linked
to assure time consistency.
Source World Economic Forum, Global Competitiveness Report; Economist Intelligence
Unit, Business Environment Rankings.
Area 3 Sound Money
A Money growth
This component measures the average annual growth of the money supply
in the last five years minus average annual growth of real GDP in the last ten
years. Countries where growth of the money supply greatly exceeds growth of
real output receive lower ratings. The broad money supply (basically what used
to be called M2) is used to measure the money supply. The rating is equal to:
(Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the average annual growth rate of
the money supply during the last five years adjusted for the growth of real GDP
during the previous ten years. The values for Vmin and Vmax are set at 0% and 50%,
respectively. Therefore, if the adjusted growth rate of the money supply during
the last five years is 0%, indicating that money growth is equal to the long-term
growth of real output, the formula generates a rating of 10. Ratings decline as
the adjusted growth of the money supply increases toward 50%. When adjusted
annual money growth is equal to (or greater than) 50%, a rating of 0 results.
tional Financial Statistics; United Nations National Accounts.
B Standard deviation of inflation

This component measures the standard deviation of the inflation rate over the last
five years. Generally, the GDP deflator is used as the measure of inflation for this
component. When these data are unavailable, the Consumer Price Index is used.
The following formula is used to determine the 0-to-10 scale rating for each coun-
try: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the country’s standard deviation
of the annual rate of inflation during the last five years. The values for Vmin and
Vmax are set at 0% and 25%, respectively. This procedure will allocate the highest
ratings to the countries with the least variation in the annual rate of inflation. A
perfect 10 results when there is no variation in the rate of inflation over the five-
year period. Ratings will decline toward 0 as the standard deviation of the infla-
tion rate approaches 25% annually.
tional Financial Statistics.
C Inflation: most recent year

Generally, the Consumer Price Index is used as the measure of inflation for this
component as it is often available before the GDP deflator is available. When these
data are unavailable, the GDP deflator inflation rate is used. The 0-to-10 country
ratings are derived by the following formula: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi rep-
resents the rate of inflation during the most recent year. The values for Vmin and Vmax

are set at 0% and 50%, respectively: the lower the rate of inflation, the higher the
rating. Countries that achieve perfect price stability earn a rating of 10. As the cur-
rent annual inflation rate moves towards 50%, the rating for this component moves
toward 0. A 0 rating is assigned to all countries with an inflation rate of 50% or more.
tional Financial Statistics.
D Foreign currency bank accounts

When foreign-currency bank accounts are permissible without any restrictions
both domestically and abroad, the rating is 10; when these accounts are restricted,
the rating is 0. If foreign currency bank accounts were permissible domestically
but not abroad (or vice versa), the rating is 5.
Sources International Monetary Fund, Annual Report on Exchange Arrangements and
Exchange Restrictions.
Area 4 Freedom to Trade Internationally
A Tariffs
i Trade tax revenue
This subcomponent measures the amount of tax on international trade as a share
of exports and imports. The formula used to calculate the ratings for this subcom-
ponent is: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the revenue derived from
taxes on international trade as a share of the trade sector. The values for Vmin and
Vmax are set at 0% and 15%, respectively. This formula leads to lower ratings as
the average tax rate on international trade increases. Countries with no specific
taxes on international trade earn a perfect 10. As the revenues from these taxes
rise toward 15% of international trade, ratings decline toward 0.
Sources International Monetary Fund, Government Finance Statistics Yearbook; Interna-
tional Monetary Fund, International Financial Statistics.
ii Mean tariff rate

This subcomponent is based on the unweighted mean of tariff rates. The for-
mula used to calculate the 0-to-10 rating for each country is: (Vmax − Vi) / (Vmax −
Vmin) × 10. Vi represents the country’s mean tariff rate. The values for Vmin and
Vmax are set at 0% and 50%, respectively. This formula will allocate a rating of 10
to countries that do not impose tariffs. As the mean tariff rate increases, countries
are assigned lower ratings. The rating will decline toward 0 as the mean tariff rate
approaches 50%. (Note that, except for two or three extreme observations, all
countries have mean tariff rates within this range from 0% to 50%.)
Source World Trade Organization, World Tariff Profiles.
iii Standard deviation of tariff rates

Compared to a uniform tariff, wide variations in tariff rates indicate greater efforts
towards central planning of the economy’s production and consumption patterns.
Thus, countries with a greater variation in their tariff rates are given lower ratings.
The formula used to calculate the 0-to-10 ratings for this component is: (Vmax − Vi) /
(Vmax − Vmin) × 10. Vi represents the standard deviation of the country’s tariff rates.

The values for Vmin and Vmax are set at 0% and 25%, respectively. This formula will
allocate a rating of 10 to countries that impose a uniform tariff. As the standard
deviation of tariff rates increases towards 25%, ratings decline toward 0.
Source World Trade Organization, World Tariff Profiles.
B Regulatory trade barriers

i Non-tariff trade barriers
This subcomponent is based on two sources. (a) The first source is the Global
Competitiveness Report survey question: “In your country, tariff and non-tariff bar-
riers significantly reduce the ability of imported goods to compete in the domes-
tic market. 1–7 (best)”. The question’s wording has varied slightly over the years.
(b) The second source is the “Tariff and non-tariff barriers” indicator from the
Economist Intelligence Unit. The final rating is the average of whichever of these
sources are available, and the data are chain-linked to assure time consistency.
Note that, notwithstanding the subcomponent’s title, this indicator captures both
tariff and non-tariff barriers.
Unit, Business Environment Rankings.
ii Costs of importing and exporting

This subcomponent is based on the World Bank’s Doing Business data on the time
(i.e., non-money) cost of procedures required to import a full 20-foot container of
dry goods that contains no hazardous or military items. Countries where it takes
longer to import or export are given lower ratings. 0-to-10 ratings are constructed
for (1) the time cost (in hours) associated with border compliance and documentary
compliance when exporting; and (2) the time cost (in hours) associated with border
compliance and documentary compliance when importing. These two ratings are
then averaged to arrive at the final rating for this subcomponent. The formula used
to calculate the 0-to-10 ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the
time-cost value. The values for Vmax and Vmin are set, respectively, at 228.38 and 0
hours for exporting; and 338.00 hours and 0 hours for importing. Countries with
values outside the Vmax and Vmin range receive ratings of either 0 or 10, accordingly.
C Black-market exchange rates

This component is based on the percentage difference between the official and
the parallel (black-market) exchange rate. The formula used to calculate the 0-to-
10 ratings for this component is the following: (Vmax − Vi) / (Vmax − Vmin) × 10.
Vi is the country’s black-market exchange-rate premium. The values for Vmin and
Vmax are set at 0% and 50%, respectively. This formula will allocate a rating of 10
to countries without a black-market exchange rate; that is, those with a domestic
currency that is fully convertible without restrictions. When exchange-rate con-
trols are present and a black market exists, the ratings will decline toward 0 as the
black-market premium increases toward 50%. A 0 rating is given when the black-
market premium is equal to, or greater than, 50%.
Source MRI Bankers’ Guide to Foreign Currency.

D Controls of the movement of capital and people

i Financial openness
This subcomponent is based on two sources. (a) The first source is the Chinn-Ito
Index of de jure financial openness. This index is composed of a series of dummy
variables that “codify the tabulation of restrictions on cross-border financial
transactions reported in the IMF’s Annual Report on Exchange Arrangements
and Exchange Restrictions.” This data source scores on a continuous scale from
0-to-1, so it is multiplied by 10 to place it on the 0-to-10 scale. (b) The second
source is the “Capital account liberalization” indicator from the Economist
Intelligence Unit.
Source Menzie Chinn and Hiro Ito (2006), What Matters for Financial Development?
Capital Controls, Institutions, and Interactions, Journal of Development Econom-
ics 81, 1: 163–191; Menzi Chinn and Hiro Ito (2008), A New Measure of Financial
Openness, Journal of Comparative Policy Analysis 10, 3: 309–322; see also <http://
web.pdx.edu/~ito/Chinn-Ito_website.htm>; Economist Intelligence Unit, Business
Environment Rankings.
ii Capital controls
The International Monetary Fund reports on up to 13 types of international capital
controls. The zero-to-10 rating is the percentage of capital controls not levied as a
share of the total number of capital controls listed, multiplied by 10.
Source International Monetary Fund, Annual Report on Exchange Arrangements and
Exchange Restrictions.
iii Freedom of foreigners to visit

This component measures the percentage of countries for which a country
requires a visa from foreign visitors. It reflects the freedom of foreigners to travel
to this country for tourist and short-term business purposes. The formula used to
calculate the zero-to-10 ratings is: (Vi − Vmin) / (Vmax − Vmin) × 10. Vi represents
the component value. The values for Vmax and Vmin were set at 47.2 (1 standard
deviation above average) and 0. Countries with values outside the range between
Vmax and Vmin received ratings of either 0 or 10, accordingly.
Sources Robert Lawson and Jayme Lemke (2012), Travel Visas, Public Choice 154, 1-2: 17–36;
authors’ calculations.
iv Protection of foreign assets

Competitiveness Report survey questions on “Prevalence of foreign ownership”
and “Business impact of rules on FDI”. (b) The second source is the “Risk of
expropriation of foreign assets” from the Economist Intelligence Unit. The final
rating is the average of whichever of these sources are available, and the data are
chain-linked to assure time consistency.
Sources World Economic Forum, Global Competitiveness Report; World Bank, World-
wide Governance Indicators; Economist Intelligence Unit, Business Environment
Rankings.

Area 5 Regulation
A Credit market regulation

i Ownership of banks
Data on the percentage of bank deposits held in privately owned banks are used
to construct rating intervals. Countries with larger shares of privately held depos-
its received higher ratings. When privately held deposits total between 95% and
100%, countries are given a rating of 10. When private deposits constitute between
75% and 95% of the total, a rating of 8 is assigned. When private deposits are
between 40% and 75% of the total, the rating is 5. When private deposits total
between 10% and 40%, countries received a rating of 2. A 0 rating is assigned
when private deposits are 10% or less of the total.
Sources Anginer, D., A. Can Bertay, R. Cull, A. Demirgüç-Kunt, and D.S. Mare (2019),
Bank Regulation and Supervision Ten Years after the Global Financial Crisis, Policy
Research Working Paper, World Bank; World Bank, Bank Regulation and Supervi-
sion Survey; James R. Barth, Gerard Caprio, and Ross Levine (2006), Rethinking
Bank Regulation: Till Angels Govern, Cambridge University Press.
ii Private sector credit

This subcomponent measures the extent of government borrowing relative to
private-sector borrowing. If the data are available, this subcomponent is calcu-
lated as the government fiscal deficit as a share of gross saving. The formula used
to derive the country ratings for this subcomponent is (Vmax − Vi) / (Vmax − Vmin) ×
10. Vi is the [absolute value of the] the ratio of deficit to gross savings, and the val-
ues for Vmax and Vmin are set at 100% and 0%, respectively. The formula allocates
higher ratings as the deficit gets smaller relative to gross saving.
If the deficit data are not available, the component is instead based on the share
of private credit relative to total credit extended in the banking sector. Thus, the
formula used to derive the country ratings for this subcomponent is (Vi − Vmin) /
(Vmax − Vmin) × 10. Vi is the share of the country’s total domestic credit allocated
to the private sector and the values for Vmax and Vmin are set at 99.9% and 10.0%,
respectively. The formula allocates higher ratings as the share of credit extended
to the private sector increases.
Sources World Bank, World Development Indicators; World Economic Forum, Global
Competitiveness Report; International Monetary Fund, International Financial
Statistics.
iii Interest rate controls / negative real interest rates

Countries with interest rates determined by the market, stable monetary pol-
icy, and reasonable real-deposit and lending-rate spreads received higher ratings.
When interest rates are determined primarily by market forces as evidenced by
reasonable deposit and lending-rate spreads, and when real interest rates are posi-
tive, countries are given a rating of 10. When interest rates are primarily market-
determined but the real rates are sometimes slightly negative (less than 5%) or the
differential between the deposit and lending rates is large (8% or more), countries
received a rating of 8. When the real deposit or lending rate is persistently nega-
tive by a single-digit amount or the differential between them is regulated by the
government, countries are rated at 6. When the deposit and lending rates are fixed
by the government and the real rates are often negative by single-digit amounts,

countries are assigned a rating of 4. When the real deposit or lending rate is per-
sistently negative by a double-digit amount, countries received a rating of 2. A 0
rating is assigned when the deposit and lending rates are fixed by the government
and real rates are persistently negative by double-digit amounts or hyperinflation
has vitually eliminated the credit market.
tional Financial Statistics; CIA, The World Factbook.
B Labor market regulation

i Labor regulations and minimum wage
This subcomponent is based on two sources. (a) The first source is the “Employing
Workers” section of the World Bank’s Doing Business and uses the following data:
(1) whether fixed-term contracts are prohibited for permanent tasks; (2) the
maximum cumulative duration of fixed-term contracts; and (3) the ratio of the
minimum wage for a trainee or first-time employee to the average value added
per worker. Countries with restrictions on fixed-term contracts, restrictions on
the duration of fixed-term contracts, and/or higher minimum wages receive
lower ratings. (b) The second source is the “Wage regulation” indicator from the
Source World Bank, Doing Business; Economist Intelligence Unit, Business Environment Ratings.
ii Hiring and firing regulations

Competitiveness Report question: “The hiring and firing of workers is impeded
by regulations (= 1) or flexibly determined by employers (= 7)”. The question’s
wording has varied over the years. (b) The second source is the “Restrictiveness
of labour laws” indicator from the Economist Intelligence Unit. The final rating
is the average of whichever of these sources are available, and the data are chain-
linked to assure time consistency.
Unit, Business Environment Ratings.
iii Flexible wage determination

This subcomponent is based on the Global Competitiveness Report question:
“Flexibility of wage determination, 1–7 (best)”. In earlier years, the question is
“Wages in your country are set by a centralized bargaining process (= 1) or up to
each individual company (= 7)”. Before 2000, the actual union density is used to
determine ratings for select countries.
Source World Economic Forum, Global Competitiveness Report.
iv Hours regulations
This subcomponent is based on the Employing Labor section in the World Bank’s
Doing Business; it uses the following five components: (1) whether there are
restrictions on night work; (2) whether there are restrictions on holiday work;
(3) whether the length of the work week can be 5.5 days or longer; (4) whether
there are restrictions on overtime work; and (5) whether the average paid annual
leave is 21 working days or more. For each question, when the regulations apply,
a score of 1 is given. If there are no restrictions, the economy receives a score of 0.

The 0-to-10 rating is based on how many of these regulations are in place: zero reg-
ulations results in a rating of 10; one regulation results in a rating of 8; and so on.
v Costs of worker dismissal

This subcomponent is based on the World Bank’s Doing Business data on the cost
of the advance-notice requirements, severance payments, and penalties due when
dismissing a redundant worker with 10-years tenure. The formula used to calcu-
late the 0-to-10 ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents the dis-
missal cost (measured in weeks of wages). The values for Vmax and Vmin are set at
58 weeks and 0 weeks, respectively. Countries with values outside the Vmax and
Vmin range received ratings of either 0 or 10, accordingly.
vi Conscription
Data on the use and duration of military conscription are used to construct rat-
ing intervals. Countries with longer conscription periods received lower ratings.
A rating of 10 is assigned to countries without military conscription. When length
of conscription is six months or less, countries are given a rating of 5. When length
of conscription is more than six months but not more than 12 months, countries
are rated at 3. When length of conscription is more than 12 months but not more
than 18 months, countries are assigned a rating of 1. When conscription periods
exceeded 18 months, countries are rated 0. If conscription is present but apparently
not strictly enforced or the length of service could not be determined, the coun-
try is given a rating of 3. In cases where it is clear conscription is never used, even
though it may be possible, a rating of 10 is given. If a country’s mandated national
service includes clear non-military options, the country is given a rating of 5.
Sources International Institute for Strategic Studies, The Military Balance; War Resisters
International, World Survey of Conscription and Conscientious Objection to Military
Service; additional online sources used as necessary.
vii Foreign labor

Competitiveness Report question: “To what extent does labour regulation in your
country limit the ability to hire foreign labour? (1 = Very much limits hiring for-
eign labour; 7 = Does not limit hiring foreign labour at all)”. The question’s word-
ing has varied over the years. (b) The second source is the “Hiring of foreign
nationals” indicator from the Economist Intelligence Unit. The final rating is the
average of whichever of these sources are available, and the data are chain-linked
to assure time consistency.
Sources World Economic Forum, Global Competitiveness Report; Economist Intelligence
Unit, Business Environment Ratings.
C Business regulation
i Regulatory burden
This subcomponent is based on the Global Competitiveness Report question on the
“Burden of government regulation, 1–7 (best)”. The question’s wording has varied
slightly over the years.
Source World Economic Forum, Global Competitiveness Report.

ii Bureaucracy costs
This subcomponent is based on the “Regulatory Burden Risk Ratings” from IHS
Markit, which measures “[t]he risk that normal business operations become more
costly due to the regulatory environment. This includes regulatory compliance
and bureaucratic inefficiency and/or opacity. Regulatory burdens vary across sec-
tors so scoring should give greater weight to sectors contributing the most to the
economy”. The raw scores range, roughly, from 0 to 7, with higher values indicat-
ing greater risk. The formula used to calculate the 0-to-10 ratings is: (Vmax − Vi)
/ (Vmax − Vmin) × 10. Vi is the country’s Regulatory Burden rating, while the Vmax
and Vmin are set at 5 and 0.5, respectively.
Source IHS Markit.
iii Impartial public administration

This subcomponent is based on the “Rigorous and Impartial Public Admin-
istration” data from the V-Dem dataset. If nepotism, cronyism, and discrimi-
nation are widespread in the application of public administration, countries
receive a lower score. The rating is equal to: (Vi − Vmin) / (Vmax − Vmin) × 10. The
Vi is the country’s impartial administration score, while the Vmax and Vmin are set
at 4.0 and 0, respectively.
Source V-Dem Institute, Varieties of Democracy, <www.v-dem.net>.
iv Tax compliance
This subcomponent is based on two sources. (a) The first source is the World
Bank’s Doing Business data on the time required per year for a business to prepare,
file, and pay taxes on corporate income, value added or sales taxes, and taxes on
labor. The formula used to calculate the 0-to-10 ratings is: (Vmax − Vi) / (Vmax −
Vmin) × 10. Vi represents the time cost (measured in hours) of tax compliance. The
values for Vmax and Vmin are set at 892 hours and 0 hours, respectively. Countries
with values outside the Vmax and Vmin range received ratings of either 0 or 10,
accordingly. (b) The second source is the “Tax complexity” indicator from the
Source World Bank, Doing Business; Economist Intelligence Unit, Business Environment
Ratings.
D Freedom to compete
i Market openness
This subcomponent is based on two sources. (a) The first source is the World
Bank’s Doing Business data on the amount of time and money it takes to start a
new limited-liability business. Countries where it takes longer or is costlier to start
a new business are given lower ratings. 0-to-10 ratings are constructed for three
variables: (1) time (measured in days) necessary to comply with regulations when
starting a limited liability company; (2) money costs of the fees paid to regula-
tory authorities (measured as a share of per-capita income); and (3) minimum
capital requirements, that is, funds that must be deposited into a company bank
account (measured as a share of per-capita income). These three ratings are then
averaged to arrive at the final rating for this subcomponent. The formula used
to calculate the 0-to-10 ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10. Vi represents

the variable value. The values for Vmax and Vmin are set at 104 days/317%/1,017%
and 0 days/0%/0%, respectively. Countries with values outside the Vmax and Vmin
range received ratings of either 0 or 10, accordingly. (b) The second source are the
“Freedom of existing businesses to compete” and “Level of government regulation
and impact on private business” indicators from the Economist Intelligence Unit.
The latter indicator is based heavily on regulations related to starting a business.
The final rating is the average of whichever of these sources are available, and the
data are chain-linked to assure time consistency.
Sources World Bank, Doing Business; Economist Intelligence Unit, Business Environment
Ratings.
ii Business permits
This subcomponent is based on the World Bank’s Doing Business data on the time
in days and monetary costs required to obtain a license to construct a standard
warehouse. 0-to-10 ratings are constructed for (1) the time cost (measured in
number of calendar days required to obtain a license) and (2) the monetary cost
of obtaining the license (measured as a share of per-capita income). These two
ratings are then averaged to arrive at the final rating for this subcomponent. The
formula used to calculate the 0-to-10 ratings is: (Vmax − Vi) / (Vmax − Vmin) × 10.
Vi represents the time or money cost value. The values for Vmax and Vmin are set at
363 days/2,763%/56 days and 0 days/0%/0%, respectively. Countries with val-
ues outside the Vmax and Vmin range received ratings of either 0 or 10, accordingly.
iii Distortion of business environment

This subcomponent is based on the “Price controls” and “State control” indicators
from the Economist Intelligence Unit.
Source Economist Intelligence Unit, Business Environment Ratings.

Economic Freedom of the World: 2023 Annual Report • 263
About the Authors
James Gwartney
James D. Gwartney is a Professor Emeritus of Economics at Florida State Univer-
sity. He is the co-author of Economics: Private and Public Choice (Cengage/South-
Western Press, 2022), a widely used principles-of-economics text that is now in
its 17th edition. He is also co-author of an economics primer, Common Sense Eco-
nomics: What Everyone Should Know about Wealth and Prosperity (St. Martin’s
Press, 2016). His publications have appeared in both professional journals and
popular media such as the Wall Street Journal and the New York Times. He served
as Chief Economist of the Joint Economic Committee of the US Congress during
1999–2000. In 2004, he was the recipient of the Adam Smith Award of the Asso-
ciation of Private Enterprise Education for his contribution to the advancement of
free-market ideals. He is a past President of the Southern Economic Association
and the Association for Private Enterprise Education. His Ph.D. in economics is
from the University of Washington.
Robert Lawson
Robert Lawson holds the Jerome M. Fullinwider Centennial Chair in Economic
Freedom; he also is director of the Bridwell Institute for Economic Freedom at
the Southern Methodist University (SMU) Cox School of Business. He earned his
Ph.D. and M.S. in Economics from Florida State University and his B.S. in Eco-
nomics from the Honors Tutorial College at Ohio University. He has authored
or co-authored over 100 journal articles, book chapters, and policy reports. With
Benjamin Powell, he is co-author of the Amazon best seller, Socialism Sucks: Two
Economists Drink Their Way through the Unfree World (Regnery Publishing, 2019).
Prof. Lawson is past-president of the Association of Private Enterprise Education,
a Senior Fellow at the Fraser Institute, and a member of the Mont Pelerin Society.
He was awarded the Adam Smith Award from the Association of Private Enterprise
Education in 2019.
Ryan Murphy
is a Research Associate Professor in the Bridwell Institute for Economic Freedom
at SMU Cox School of Business. He received his B.A. in Economics from Boston
College and M.S. and Ph.D. in Economics from Suffolk University. His research
has appeared in publications such as Economica, American Journal of Agricultural
Economics, Public Choice, Public Health, and Contemporary Economic Policy. He
is the author of Markets against Modernity: Ecological Irrationality, Public and
Private (Rowman & Littlefield, 2019).

About the Contributors
Matanda Abubaker
Matanda Abubaker is an Advocate of the High Court of Uganda and all Courts of
Judicature, currently a Magistrate in the Uganda Judiciary, and a law lecturer at
the Islamic University in Uganda. He holds an LL.M. from the Uganda Christian
University, a Post-Graduate Diploma in legal practice from the Law Development
Centre, and an LL.B. from the Islamic University in Uganda.
Andrea Celico
Andrea Celico is a Ph.D. candidate in Economics at the University of Navarre
(UNAV, Spain), specializing in the fields of political economy, institutional econ-
omy, and public choice. His research is empirical and focuses on topics including
populism, party competition, and the impact of institutional designs on cultural
traits. He’s recently been a visiting researcher at Heidelberg University (Germany).
Andrea is also the holder of a master’s degree in Economics and Finance from the
University of Navarre and a master’s degree in European Economy and Business
Law from the University of Rome Tor Vergata (Italy).

Alexander C.R. Hammond is the Founder and Director of the Initiative for Afri-
can Trade and Prosperity and a Free Trade Fellow at the Institute of Economic of
Affairs (IEA). He is also a Senior Fellow at African Liberty and a Fellow at EPI-
CENTER. Formerly, Mr Hammond worked as a Policy Analyst at the IEA and
a Research Associate at the Cato Institute’s Center for Global Liberty and Pros-
perity. He often writes about African trade and development, economic freedom,
and global well-being. His works have been translated into more than a dozen lan-
guages and have featured in popular outlets across the world, including the Wash-
ington Times, Reason Magazine, News 24, National Interest, Washington Examiner,
Newsweek, Business Insider, HumanProgress.org, and the Cato Institute’s website.
Mr Hammond’s works have also featured in several think-tank publications, and
he is the author of the HumanProgress.org column and a forthcoming Cato Insti-
tute book, Heroes of Progress: 65 People Who Changed the World.
Fred McMahon
Fred McMahon is a Fraser Institute Resident Fellow and holder of the Dr. Michael
A. Walker Research Chair in Economic Freedom. He has an M.A. in Economics
from McGill University. Mr. McMahon manages the Economic Freedom of the
World Project and the Economic Freedom Network, an international alliance of

over 100 think-tank partners in about 100 nations and territories. He is the author
of numerous research articles and several books including, Looking the Gift Horse
in the Mouth: The Impact of Federal Transfers on Atlantic Canada, which won
the Sir Antony Fisher International Memorial Award for advancing public-policy
debate, Road to Growth: How Lagging Economies Become Prosperous, and Retreat
from Growth: Atlantic Canada and the Negative Sum Economy. He has written for
numerous publications including the European Journal of Political Economy, SAIS
Journal (School of Advanced International Studies, Johns Hopkins University),
Wall Street Journal, Policy Options, National Post, Time (Canada), Globe and Mail,
Ottawa Citizen, and most other major Canadian newspapers.
Martin Rode
Martin Rode is an Associate Professor in the Department of Economics at the
University of Navarra in Pamplona (Spain). He received a doctoral degree in eco-
nomics from a joint Ph.D. program by the Universities of Cantabria, the Basque
Country, and Oviedo in 2012. Martin is also the holder of two undergraduate
degrees in Economics and Political Science, both from the University of Inns-
bruck, Austria. He has been a visiting researcher at Florida State University
(USA), Aarhus University (Denmark), and CESifo Group Munich (Germany).
Martin’s research and teaching is in the areas of Political Economy, Institutional
Economics, and Public Policy. Here, a central question is always how politics and
economic reform processes are conditioned by the underlying institutional envi-
ronments in which they are conducted. His publications have appeared, among
others, in Economics and Politics, the European Journal of Political Economy,
the Journal of Economic Behavior and Organization, Public Choice, Publius-the
Journal of Federalism, and Social Indicators Research.

Acknowledgments
We are grateful for the leadership and enduring support of the Fraser Institute, its
president Niels Veldhuis, executive vice-president Jason Clemons, and our long-
time partner and friend Fred McMahon, who holds the Dr. Michael A. Walker
Chair in Economic Freedom. Thanks to Lindsey Thomas Martin for his outstand-
ing efforts with the publication and the Fraser team that manages the website,
answers e-mails, and handles media requests on our behalf.
Fred McMahon is retiring at the end of the year, and we cannot begin to express
the appreciation we have for his work over so many years overseeing all aspects of
the EFW project—not the least of which was managing a bunch of difficult academ-
ics like us. Thank you, Fred, for everything. As his replacement, we are pleased to
welcome Matt Mitchell to the team and look forward to working with him in the
coming years. Matt has big shoes to fill.
Without the assistance and guidance of both Michael Walker, co-founder of the
Fraser Institute, and the late Rose and Milton Friedman, this project would never
have gotten off of the ground.
The too-numerous-to-name members of the Economic Freedom Network
again provided valuable support for this report. Rosemarie Fike deserves our spe-
cial thanks for her efforts to provide the measure of legal and regulatory inequities
facing women around the globe that we use in the EFW index. Our thanks also
go to Kathy Makinen of Florida State University for her many years of research
assistance on the marginal tax-rate component; Kathy is soon to retire and we
wish her the very best.
Finally, we express our most sincere thanks and well wishes to Joshua Hall. Josh
was an important member of the team and co-author of this report from 2010 to
2022. He is now dean of the Chambers College of Business and Economics at West
Virginia University, and unfortunately, those time-consuming duties have prompted
him to step away from the project. He should know that he has a place back on the
EFW team as soon as this silly notion of being an administrator passes.
The authors would like to thank the Charles Koch Institute, the Donner Cana-
dian Foundation, and the Sarah Scaife Foundation for their support of this project.
James Gwartney, Robert Lawson, & Ryan Murphy

The Economic Freedom Network

Co-publishers of Economic Freedom of the World
Afghanistan Afghanistan Economic and Legal Studies Organization (AELSO)
Albania Albanian Center for Economic Research (ACER)
Argentina Fundación Libertad
Armenia Centre of Political, Legal and Economic Research and Forecasting (PLERF)
Australia Institute of Public Affairs
Azerbaijan Center for Economic and Political Research
Bahamas The Nassau Institute
Belarus Scientific Research Mises Center
Belgium The Ludwig von Mises Institute-Europe
Bolivia Política Publicas para la Libertad (POPULI)
Bosnia and Herzegovina Center for Advancement of Free Enterprise
Brazil Instituto Liberal do Rio de Janeiro
Bulgaria Institute for Market Economics
Burkina Faso Le Centre des Affaires Humaines (CEDAH)
Burundi Centre for Development and Enterprises Great Lakes
Canada The Fraser Institute
Chile Instituto Libertad y Desarrollo
Colombia Instituto de Ciencia Politica
Côte d’Ivoire Audace Institut Afrique
Croatia The Institute of Economics
Czech Republic Liberální Institut
Denmark Center for Politiske Studier (CEPOS)
Dominican Republic CREES (Centro Regional de Estrategias Economicas Sostenibles)
Ecuador Instituto Ecuatoriano de Economía Política
Egypt The Egyptian Center for Public Policy Studies (ECPPS)
Ethiopia Teachings of Entrepreneurship on Antipoverty Movement (TEAM)
Finland Libera Foundation
France Institut Economique Molinari
Georgia New Economic School - Georgia

Germany Liberales Institut
Ghana The Institute of Economic Affairs
Greece KeFiM – Center for Liberal Studies – Markos Dragoumis
Guatemala Centro de Investigaciones Económicas Nacionales
Haïti Catch Up Haïti
Honduras Fundación Eléutera
Hong Kong Hong Kong Centre for Economic Research
Hungary Free Market Foundation
Iceland Centre for Social and Economic Research (RSE)
India Centre for Civil Society
Indonesia Institute for Development of Economics and Finance
Iraq Iraqi Institute for Economic Reform
Israel Jerusalem Institute for Market Studies
Italy Centro Einaudi
Kazakhstan IDEA (Institute for Development and Economic Affairs)
Kenya Eastern Africa Policy Centre
Korea, South Center for Free Enterprise
Kosovo Group for Legal and Political Studies
Kyrgyz Republic CAFMI (Central Asian Free Market Institute)
Lithuania Lithuanian Free Market Institute
Malaysia Institute for Democracy and Economic Affairs (IDEAS)
Mali The Centre Kassoum Coulibaly
Mexico Caminos de la Libertad
Mongolia Open Society Forum
Montenegro The Institute for Entrepreneurship and Economic Development (IPER)
Nepal Samriddi, The Prosperity Foundation
New Zealand The New Zealand Initiative
Nicaragua Nicaraguan Foundation for Economic and Social Development (FUNIDES)
Nigeria Initiative of Public Policy Analysis
North Macedonia The Institute for Research and European Studies (IRES)
Norway Center for Business and Society Incorporated (Civita)
Pakistan Alternate Solutions Institute

Palestine Pal-Think for Strategic Studies
Panama Fundación Libertad
Paraguay The Fundacion Issos para la Libertad y el Desarrollo
Peru Centro de Investigación y Estudios Legales (CITEL)
Philippines Center for Research and Communication
Poland Centrum IM. Adama Smitha
Portugal Instituto +Liberdade
Romania Center for Institutional Analysis and Development Eleutheria (CADI)
Russia Institute of Economic Analysis (IEA)
Serbia Libertarian Club - Libek
Singapore Adam Smith Center
Slovak Republic The F.A. Hayek Foundation
Slovenia Visio Institute
South Africa The Free Market Foundation (Southern Africa)
Spain Fundación para el Avance de la Libertad
Sri Lanka The Pathfinder Foundation
Sudan Nile Institute of Economic Studies
Sweden Timbro
Switzerland Liberales Institut
Tajikistan Tajikistan Free Market Centre
Tanzania Uhuru Initiative for Policy & Education
Trinidad and Tobago Arthur Lok Jack Graduate School of Business, The University of the West Indies
Turkey Association for Liberal Thinking
Uganda Action for Liberty and Economic Development
Ukraine Bendukidze Free Market Center
United Kingdom Institute of Economic Affairs (IEA)
United States of America Cato Institute
Uruguay Centro de Estudios para el Desarrollo
Venezuela Center for the Dissemination of Economic Knowledge (CEDICE)
Vietnam Market Solutions Research Center for Social and Economic Issues (MASSEI)
Zambia Zambia Institute for Public Policy Analysis (ZIPPA)

Associate members
The Economic Freedom Network accepts only one member per jurisdiction as a full member
of the network and co-publisher of the report but the network also has a number of associate
members. Although they are not co-publishers of Economic Freedom of the World, they work
with the network and the Fraser Institute on special projects to promote economic freedom.
Albania Foundation for Economic Freedom

ICG Research

Argentina Libertad y Progreso
Armenia Wide Opportunities Youth Non-Governmental Organization (WO YNGO)
Bolivia Libera
Brazil Estudantes Pela Liberdade
Centro Mackenzie de Liberdade Econômica

Fundação da Liberdade Econômica (FLE Brasil)

Instituto Liberdade

Burundi Institute for Economics and Enterprises
Colombia Centro para la Libre Iniciativa
Croatia Centre for Public Policy and Economic Analysis (CEA)
Ghana IMANI Center for Policy & Education

Institute for Liberty and Policy Innovation (ILAPI)

Hong Kong The Lion Rock Institute
Indonesia The Center for Indonesian Policy Studies (CIPS)
Malaysia Center for Market Education
Mongolia Mongolian National Chamber of Commerce and Industry
Montenegro The Lucha Institute
Pakistan Policy Research Institute of Market Economy (PRIME)
Paraguay Instituto Fernando de la Mora
Poland Civic Development Forum
Sri Lanka Advocata Institute
Tanzania Liberty Sparks
Turkey Özgürlük Araştırmaları Derneği
Ukraine Easy Business

Ukrainian Center for Independent Political Research

Ukrainian Economic Freedoms Foundation (UEFF)

United States of America Atlas Network

Bridwell Institute for Economic Freedom at SMU Cox School of Business

Independent Institute


Economic Freedom of The World 2023

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Economic Freedom of The World 2023

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James Gwartney, Robert Lawson,

and Ryan Murphy

MOST FREE 2ND QUARTILE 3RD QUARTILE LEAST FREE

Matanda Abubaker Andrea Celico Alexander C.R. Hammond

Fred McMahon Martin Rode

Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

Chapter 1 Economic Freedom of the World in 2021 / 1

Chapter 2 Country Data Tables / 23

Chapter 3 Populism, Majority Rule, and Economic Freedom / 189

Chapter 5 Diamonds, Dynasties, or Decent Decisions? The Origin of Botswana’s

Appendix Explanatory Notes and Data Sources / 249

About the Authors / 263

About the Contributors / 264

The Economic Freedom Network / 267

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Area 1: Size of Government

Area 2: Legal System and Property Rights

Area 3: Sound Money

Area 4: Freedom to Trade Internationally

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Gender Legal Rights Adjustment

Changes to the Index

Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

Economic freedom around the world in 2021

Rankings of other major countries

Ten lowest-rated countries

Well-being is much greater in economically free jurisdictions

• Nations in the top quartile of economic freedom had an average per-capita

• In the top quartile, 2.02% of the population experience extreme poverty

• In the top quartile, 0.98% of the population experience extreme poverty

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

A decade of growth in economic freedom

Exhibit 1.4: Average Economic Freedom Rating, 2000–2021

Chapters in the report

Chapter 1: Economic Freedom of the World in 2021

Chapter 2: Country Data Tables

Chapter 3: Populism, Majority Rule, and Economic Freedom

Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

government is significantly associated with reductions in economic freedom for

Chapter 4: The Rule of Law and Economic Freedom: Two Sides

Chapter 5: Diamonds, Dynasties, or Decent Decisions? The Origin of

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Economic Freedom of the World is is an ongoing research project. As Milton

What is economic freedom?

Economic freedom is based on the concept of self-ownership. Because of this self-

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

The Economic Freedom of the World index—an overview

Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

Structure of the EFW index

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Exhibit 1.1: Areas, Components, and Subcomponents of the EFW Index

2. Legal System and Property Rights

B. Impartial courts F. Contracts

C. Property rights G. Real property

D. Military interference H. Police and crime

B. Standard deviation of inflation D. Foreign currency bank accounts

4. Freedom to Trade Internationally

Fraser Institute ©2023 • fraserinstitute.org/economic-freedom

Area 4. Freedom to Trade Internationally focuses on exchange across national bound-

fraserinstitute.org/economic-freedom • Fraser Institute ©2023

Area 1. Size of Government: This area is unchanged.

Area 3. Sound Money: This area is unchanged.

Area 4. Freedom to Trade Internationally: The component structure is unchanged.