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Economic freedom and environmental performance

In: Handbook of Research on Economic Freedom

Author

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  • Jonas Grafström

Abstract

In this chapter, the relationship between economic freedom and environmental performance is scrutinized. The analysis relies on comparing countries’ standing in the Environmental Performance Index (EPI) of the Yale Centre for Environmental Law & Policy with two indexes of economic freedom, one developed by the Fraser Institute (Economic Freedom of the World index), and the other by the Heritage Foundation (Index of Economic Freedom). Whether economic freedom is good or bad for the environment depends on how it affects incentives, productive efforts, and effective resource use. Greater economic freedom can both harm and help environmental performance. It is a complicated relationship, but high economic freedom generally goes hand in hand with high scores in the EPI.

Suggested Citation

  • Jonas Grafström, 2024. "Economic freedom and environmental performance," Chapters, in: Niclas Berggren (ed.), Handbook of Research on Economic Freedom, chapter 23, pages 343-356, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:21220_23
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    File URL: https://www.elgaronline.com/doi/10.4337/9781802206159.00033
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    Keywords

    Economics and Finance;

    Statistics

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