No Relationship between Economic Freedom and Economic Growth: A Note

The purpose of this research note is to re-examine the link between economic freedom and economic growth because the connection has been massively over played in the past 50 years. Answering this question has important socioeconomic policy implications as economic freedom as a means of fostering higher economic growth has been high on the priority list of leading countries like the UK and US. Indeed, virtually every country in the world has embarked on this agenda of increasing economic freedom either voluntarily or at the behest of the World Bank and IMF through Washington Consensus of increasing economic freedom at all costs. The costs of liberalisation and hence increasing economic freedom have been ongoing moral hazard problems, heightened financial instability, unsustainable global debt problems, increased geopolitical risks, greater economic disequilibrium, the rise of protectionism and international social upheaval. A new economic development order needs to be constructed based on solving these issues.