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Improving Economic Freedom Lowers Debt Levels

Created on January 18, 2012

Improving Economic Freedom Lowers Debt Levels

Mature economies

Developing economies

Each dot represents a score recorded in the Index of Economic Freedom

from 2002 to 2011

Trend Line— Developing Economies (Correlation: –0.17)

Trend Line— Mature Economies (Correlation: –0.54)

Change in Debt Level (Percentage Point)

Change in Index of Economic Freedom Score, 2002 to 2011

 

Sources: Terry Miller, Kim R. Holmes, and Edwin J. Feulner, 2012 Index of Economic Freedom (Washington, D.C.: The Heritage Foundation and Dow Jones & Company, Inc., 2012), at www.heritage.org/index; International Monetary Fund, World Economic Outlook Databases, at http://www.imf.org/external/ns/cs.aspx?id=28 (November 16, 2011); and International Monetary Fund, “A Historical Public Debt Database,” at http://www.imf.org/external/pubs/cat/longres.cfm?sk=24332.0 (November 16, 2011).

heritage.org

Chart 4