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Does economic freedom make us more tolerant?

2020-09-14

The market economy often affects trust and tolerance in society, but the market economy can also lead to a lowering of tolerance. It can also drive antisemitic perceptions. These are the findings in Niclas Berggren and Therese Nilsson’s research. They are the authors of one of the chapters in this year’s Economic Freedom of the World Report. An annual report published by the Fraser Institute. The report presents data on the amount of economic freedom of the world.

In countries with a high degree of rule of law, the population tends to be more tolerant of homosexuals and people of another ethnicity than their own. The research also shows that globalization tends to lead to a higher amount of tolerance.

– It is important to protect the rule of law, not only for the sake of justice but also so that people can trust people who are different. That fosters tolerance. It is also important to protect globalization. Many have been focusing on its economical consequences, but we show that it also has cultural effects. Parents are more willing to teach their children tolerance in a globalized world because they understand that it is in the interest of their children to be able to mix with people who are different, say Therese Nilsson and Niclas Berggren.

But there are also cases where liberalizations of trade can lead to a higher degree of anti-semitism. This is due to the fact that one of the central misconceptions within anti-semitism is the notion that Jews are in control of the world economy. This augmentation can however be counterfeited if the rule of law is strong.

– Our research on antisemitism is still preliminary, but we find that this particular type of intolerance can increase when economically beneficiary reforms of trade and capital flows are being made. Therefore, it is important to counterfeit such results by protecting the quality of the legal system, according to Niclas Berggren and Therese Nilsson.

Therese Nilsson and Niclas Berggren are both researchers within the research program The Economics of Institutions and Culture at IFN, where they are examining the conjunction between law, cultural norms and values, and economy. In the chapter ”Economic Freedom as a Driver of Trust and Tolerance”, they are presenting their research together with the research made by IFN colleagues Martin Ljunge and Henrik Jordahl.

Read the chapter here

Find the full report here

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