Economic Freedom and Life Satisfaction

A Cross Country Analysis

J.J. Graafland, B. Compen

Research output: Working paperDiscussion paperOther research output

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Abstract

Abstract: This paper estimates the relationship between various sub-indicators of economic freedom and life satisfaction for 122 countries. The estimation results show that life satisfaction is positively related to the quality of the legal system and protection of property rights. For poor countries, freedom of trade fosters life satisfaction as well. Life satisfaction is independent from the size of the government and sound money and tends to be negatively related to low regulation. If the relationship between life satisfaction and economic freedom is controlled for income per capita, life satisfaction is independent from economic freedom. This indicates that the relationship between life satisfaction and economic freedom is mediated by income per capita.
Original languageEnglish
Place of PublicationTilburg
PublisherEconomics
Number of pages27
Volume2012-038
Publication statusPublished - 2012

Publication series

NameCentER Discussion Paper
Volume2012-038

Fingerprint

Cross-country analysis
Economic freedom
Life satisfaction
Per capita income
Legal protection
Legal system
Government
Property rights

Keywords

  • economic freedom
  • free trade
  • government size
  • income per capita
  • life satisfaction
  • regulation
  • respect of private property
  • sound money

Cite this

Graafland, J. J., & Compen, B. (2012). Economic Freedom and Life Satisfaction: A Cross Country Analysis. (CentER Discussion Paper; Vol. 2012-038). Tilburg: Economics.
Graafland, J.J. ; Compen, B. / Economic Freedom and Life Satisfaction : A Cross Country Analysis. Tilburg : Economics, 2012. (CentER Discussion Paper).
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Graafland, JJ & Compen, B 2012 'Economic Freedom and Life Satisfaction: A Cross Country Analysis' CentER Discussion Paper, vol. 2012-038, Economics, Tilburg.

Economic Freedom and Life Satisfaction : A Cross Country Analysis. / Graafland, J.J.; Compen, B.

Tilburg : Economics, 2012. (CentER Discussion Paper; Vol. 2012-038).

Research output: Working paperDiscussion paperOther research output

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AU - Compen, B.

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N2 - Abstract: This paper estimates the relationship between various sub-indicators of economic freedom and life satisfaction for 122 countries. The estimation results show that life satisfaction is positively related to the quality of the legal system and protection of property rights. For poor countries, freedom of trade fosters life satisfaction as well. Life satisfaction is independent from the size of the government and sound money and tends to be negatively related to low regulation. If the relationship between life satisfaction and economic freedom is controlled for income per capita, life satisfaction is independent from economic freedom. This indicates that the relationship between life satisfaction and economic freedom is mediated by income per capita.

AB - Abstract: This paper estimates the relationship between various sub-indicators of economic freedom and life satisfaction for 122 countries. The estimation results show that life satisfaction is positively related to the quality of the legal system and protection of property rights. For poor countries, freedom of trade fosters life satisfaction as well. Life satisfaction is independent from the size of the government and sound money and tends to be negatively related to low regulation. If the relationship between life satisfaction and economic freedom is controlled for income per capita, life satisfaction is independent from economic freedom. This indicates that the relationship between life satisfaction and economic freedom is mediated by income per capita.

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KW - government size

KW - income per capita

KW - life satisfaction

KW - regulation

KW - respect of private property

KW - sound money

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Graafland JJ, Compen B. Economic Freedom and Life Satisfaction: A Cross Country Analysis. Tilburg: Economics. 2012. (CentER Discussion Paper).