Working Paper No. 1276

Does Economic Freedom Boost Growth for Everyone?

Published: May 2, 2019Pages: 30Keywords: Economic freedom; Liberalization; Economic growth; Income inequalityJEL-codes: O40; O43; P16

Does Economic Freedom Boost Growth for Everyone? Andreas Bergh and Christian Bjørnskov


While the association between economic freedom and long-run economic growth is well documented, the parallel research literature on the distributional consequences of economic freedom is full of conflicting findings.

In this paper, we take a step towards reconciling the two literatures by exploring the within-quintile growth consequences of changes in three different types of economic freedom: the size of government, institutional quality and policy quality. While the associations are theoretically ambiguous, we find evidence that economic freedom affects all parts of the income distribution equally, and some indications that the growth effects are largest for the poorest and richest quintiles.

Andreas Bergh

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Mob: 070 779 0734
andreas.bergh@ifn.se

Christian Bjørnskov

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Ph: +45 87 16 48 19
Mob: +45 20 12 03 84
chbj@econ.au.dk

Interdisciplinary European Studies

The European Union in a Changing World Order

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This book explores how the European Union responds to the ongoing challenges to the liberal international order. These challenges arise both within the EU itself and beyond its borders, and put into question the values of free trade and liberal democracy. 

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