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The new edition of the Cato Journal has this excellent article [2] by James Gwartney, Randall Holcombe, and Robert Lawson: “Economic Freedom, Institutional Quality, and Cross-Country Differences in Income and Growth.”
Examining data on 99 countries from 1980 to 2000, the authors find that greater economic freedom (as measured here [3]):
– means more investment as a share of GDP
– means higher annual growth of capital per worker
– means higher productivity of investment
– requires from five to ten years to reach its maximum potential at increasing prosperity
It’s a compelling read.
Also, while you’re at the Cato Journal, check out this fine article [4] by George Mason University graduate students Chris Coyne and Peter Leeson, and this splendid review [5] by Bill Niskanen of the first volume of the selected works of Gordon Tullock.