The Economic Freedom of the World is an annual project started with the help of Nobel laureate Milton Friedman. The report uses 21 objective criteria to produce an economic freedom index of the world, published by the Cato Institute, Canada’s Fraser Institute and institutes from 50 other countries.
In this year’s report, Hong Kong is still the world’s freest economy, with Singapore coming a close second. But the United States has dropped from fourth to fifth position, according to the study, which is a comprehensive rating of 123 of the world’s economies.
Why are some countries rich while others are poor? The report shows that the more economic freedom a country has, the greater its wealth and economic growth. Economically free countries also score higher on the United Nations Human Development Index. And among developing nations, more freedom translates into less poverty.
A full-text version of the report is also available online in Adobe Acrobat PDF format.