Economic Freedom, Reforms, and Sustainable Growth

 

The lack of economic growth leads to poverty, hardship, or even civil conflict. In contrast, greater national output means that there is a bigger cake to be shared by the citizenry if equitable policies are pursued that allow everyone to participate in the economy on equal terms. Higher economic growth is more likely to occur under conditions where individuals have a chance to participate freely in markets, where they can make the best use of their talents to enhance their material well-being. Thus economic freedom is inextricably linked to sustainable economic growth and development.

 

Economic freedom is at the core of attaining sustainable economic growth. It has been empirically proven that more economically free countries are able to generate greater prosperity for their citizens and spur development. In contrast, countries where the degree of economic freedom is low experience stagnation and – as is the case in many developing countries – fail to lift their populations out of poverty.

 

In order to bring about growth and development, economic freedom must be accompanied by efficient market institutions that facilitate it. A proper legal and regulatory framework must be put in place to create good business environment and make sure that everyone can participate in the market on equal terms. Necessary reforms are not that easily implemented. They require time and call for grassroots initiatives to improve the functioning of local economies. But history shows that countries that grasp the importance of business and markets to development are the ones best equipped to realize and sustain economic gains.