By Catalina Righter
On Tuesday, Sept. 30, Washington College students were treated to a preview of the 2014 Economic Freedom of the World Report a full week before it was officially presented on Oct. 8.
Joshua Hall from the department of economics at West Virginia University gave the talk, which was attended by students and faculty, including Interim President Jay Griswold and his wife. The Department of Economics and the Washington College Republicans cosponsored the event, and it was funded by the William James Forum.
“Economic Freedom of the World,” which has been published annually since 1996, is prepared by The Economic Freedom Network (EFN). It is an index that includes data from 152 countries in order to objectively measure economic freedom.
The five components of economic freedom as defined by the EFN are size of government and taxation, private property and the rule of law, trade regulation and tariffs, regulation of business, labour and capital markets, and sound money.
The EFN, a collective of independent organizations from over 90 countries, is one of many initiatives of the Frasier Institute, an independent non-profit research and educational think tank based in Canada. “The Fraser Institute publishes peer-reviewed research into critical economic and public policy issues including taxation, government spending, health care, school performance, and trade,” according to its website.
President of the College Republicans Kevin Lair introduced the talk and detailed some of the methods and criteria used in measuring economic freedom. “His contributions are central for discussion…around the world,” said Lair of Hall.
Lair then handed the stage to Provost and Dean of the College Emily Chamlee-Wright. She was a former colleague of Hall’s and said he was “an exemplar of the teacher/scholar model…. To say that Josh is a good scholar is to say that LeBron James is a good basketball player…Josh lights a match that ignites the intellectual fire within his students.” Hall is the author of over 100 academic journal articles, book chapters, and scholarly studies.
Hall said that he was inspired to be a part of the Economic Freedom Report because of the need for hard data to back up economic and political discussions. “I remember taking a political philosophy class in middle school and discussing big ideas…All we could do was argue values.”
He said, “Our goal is to measure Economic Freedom because we believe it’s somehow important: no more, no less.” The initiative for the Report was started by the economist Milton Freedman in 1984.
According to the EFN, economic freedom is defined for individuals as “when property they acquire without the use of force, fraud, or theft is protected from physical invasions by others and they are free to use, exchange, or give their property as long as their actions do not violate the identical rights of others.”
Economic Freedom has been shown to benefit citizens when their country endorses it. According to a news release from the Economic Freedom Network, “Research shows that people living in countries with high levels of economic freedom enjoy greater prosperity, more political and civil liberties, and longer life spans.”
The US moved from number 17 in 2013 to number 12 in the index this year. This is a significant decrease from the early 2000’s when it was ranked #2 in the world. Hong Kong was once again ranked top in the world, the same as last year.
However, according to Hall, “There is no optimal level of economic freedom” for a country. “Optimal compared to what? It’s up to individual judgment.” He said, “Our job is not to say whether things are good or bad… just whether they infringe on economic freedom.”
According to Hall, the report is not perfect. “There more heterogeneous, the less accurately we can measure the lived experience of people in that country… That’s why sub-national indexes are important.”
When asked what was most surprising about the report, he said, “That the size of government really doesn’t matter.”
The presentation was followed by a question and answer session and a reception in the Underwood Lobby.
“Economic Freedom of the World: 2014 Annual Report,” the most recent index, is available online at freetheworld.com.