Economic Freedom Report 2014

For 20 years The Heritage Foundation, in partnership with The Wall Street Journal, has tracked the march of economic freedom around the world with the influential Index of Economic Freedom

The index authors have a pretty good definition of economic freedom which I quote in full:

"Economic freedom is the fundamental right of every human to control his or her own labor and property. In an economically free society, individuals are free to work, produce, consume, and invest in any way they please. In economically free societies, governments allow labor, capital and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself."

Here is a summary of the latest results including the country rankings:

 

Index of Economic Freedom

It is interesting to note the strong performance of the two Asian centres.  Hong Kong with its open markets and robust but sound regulation continues to prosper, and this is likely to continue whilst ever China continues to favour this international capital entrepot over Shanghai.  However, if Shanghai internationalises Hong Kong could face some headwinds.

Singapore, often called the Switzerland of Asia, is a different matter. The same accommodating spirit of enterprise and a respected regulatory system, but its financial services industry built on banking secrecy will find the new world of transparency more difficult to deal with than many. Perhaps Singapore's greatest challenge is its indebtedness, public and private which shows no sign of abating, leading to fears over asset bubbles.

Jersey does not show in these numbers as a Crown Dependency but I would wager it would have a strong showing. Committed to responsible capitalism, open markets, sound regulation, the rule of law, respect for property rights, and an absence of corruption, it has a lot going for it as an exemplar for other small nations.

 

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