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Does economic freedom boost growth for everyone?

Bergh, Andreas LU and Bjørnskov, Christian (2021) In Kyklos 74(2). p.170-186
Abstract
While the association between economic freedom and long-term economic growth has been well documented, the parallel research literature on the distributional consequences of economic freedom is full of conflicting findings. In this paper, we take a step toward reconciling these two bodies of literature by exploring the within-quintile growth consequences of changes in three separate elements of economic freedom: the size of government, institutional quality and and policy quality. Although the distributional consequences of increases in economic freedom are theoretically ambiguous, we find evidence that economic freedom affects all parts of the income distribution equally, in addition to indications that the growth effects are largest for... (More)
While the association between economic freedom and long-term economic growth has been well documented, the parallel research literature on the distributional consequences of economic freedom is full of conflicting findings. In this paper, we take a step toward reconciling these two bodies of literature by exploring the within-quintile growth consequences of changes in three separate elements of economic freedom: the size of government, institutional quality and and policy quality. Although the distributional consequences of increases in economic freedom are theoretically ambiguous, we find evidence that economic freedom affects all parts of the income distribution equally, in addition to indications that the growth effects are largest for the poorest and richest quintiles. (Less)
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author
and
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
growth, economic freedom, distribution
in
Kyklos
volume
74
issue
2
pages
17 pages
publisher
Wiley-Blackwell
external identifiers
  • scopus:85099808903
ISSN
0023-5962
DOI
10.1111/kykl.12262
language
English
LU publication?
yes
id
febd9902-be1e-4403-9de7-a16c3d113847
date added to LUP
2022-02-08 20:36:05
date last changed
2022-04-26 23:56:07
@article{febd9902-be1e-4403-9de7-a16c3d113847,
  abstract     = {{While the association between economic freedom and long-term economic growth has been well documented, the parallel research literature on the distributional consequences of economic freedom is full of conflicting findings. In this paper, we take a step toward reconciling these two bodies of literature by exploring the within-quintile growth consequences of changes in three separate elements of economic freedom: the size of government, institutional quality and and policy quality. Although the distributional consequences of increases in economic freedom are theoretically ambiguous, we find evidence that economic freedom affects all parts of the income distribution equally, in addition to indications that the growth effects are largest for the poorest and richest quintiles.}},
  author       = {{Bergh, Andreas and Bjørnskov, Christian}},
  issn         = {{0023-5962}},
  keywords     = {{growth; economic freedom; distribution}},
  language     = {{eng}},
  month        = {{05}},
  number       = {{2}},
  pages        = {{170--186}},
  publisher    = {{Wiley-Blackwell}},
  series       = {{Kyklos}},
  title        = {{Does economic freedom boost growth for everyone?}},
  url          = {{http://dx.doi.org/10.1111/kykl.12262}},
  doi          = {{10.1111/kykl.12262}},
  volume       = {{74}},
  year         = {{2021}},
}