The United Nations and other bodies have called for more foreign aid to help lift developing nations out of poverty. Yet in new research published in this year’s report, William Easterly, an economist from New York University, finds that economic freedom has a strong and positive impact on growth, and that foreign aid does not. He dispels the notion of a "poverty trap" and shows that poor countries with more economic freedom grow faster than rich countries
This year's report notes that economic freedom remains on the rise. The average economic freedom score rose from 5.1 (out of 10) in 1980 to 6.5 in the most recent year for which data are available. Of the 102 nations with scores in 1980 and in the most recent index, 98 recorded improvements in their economic freedom score, four saw a decline. In this year's index, Hong Kong retains the highest rating for economic freedom, 8.7 out of 10, followed by Singapore at 8.5. New Zealand, Switzerland, and the United States tied for third with ratings of 8.2. Ireland and the United Kingdom are tied for 6th at 8.1. Canada ranked 8th with a rating of 8.0. Iceland and Luxembourg are tied for 9th at 7.9.
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