The Index of Economic Freedom, published annually by The Heritage Foundation, provides a quantitative assessment of a nation’s economic environment. This assessment is distilled into a numerical score, reflecting the degree to which a country’s policies and institutions support economic liberty. This score considers factors such as property rights, government integrity, tax burden, government spending, business freedom, labor freedom, monetary freedom, trade freedom, investment freedom, and financial freedom.
A higher score generally indicates a more conducive environment for economic prosperity, attracting foreign investment, fostering entrepreneurship, and promoting overall growth. Conversely, a lower score signals potential obstacles to economic development, often associated with corruption, excessive regulation, and weak legal frameworks. Tracking the trend of a nation’s economic freedom score over time offers insights into the effectiveness of policy reforms and the trajectory of its economic development.
