I want to write a blog post on capitalism’s effect on poverty. I believe the biggest challenge will be finding the data. What data is out there measuring the economic freedom level of various countries over time? I have a feeling this is a very big project but would imagine that others have done a lot of research in this area already, and so I hope it won’t be too difficult. The poverty data likely won’t be too difficult. What may be difficult is the capitalism data. I know have heard of the “economic freedom index”, but it probably does not go back into history as far back as I would like. I’ll definitely be using it to the extent possible though.
http://en.wikipedia.org/wiki/Index_of_Economic_Freedom_historical_rankings
The latest index in 2010 makes New Zealand technically the most capitalist nation out there, and all past rankings also make New Zealand the most capitalist economy in the world.
I am not including non-countries like Hong Kong or Singapore, so bear with me.
Considering that New Zealand and Switzerland have consistently remained the most capitalist nations for the longest periods of time, I’d reckon they can be used as solid examples, but poverty in those nations is negligible. I wouldn’t call it capitalism’s effect necessarilly - those have always been rich places.
In the long run, geography, climate, and demographics make infinitely more difference than economic policy; even something of value was created in mercantilist inflationist Europe.
I strongly disagree with this statement.
Both Singapore and Australia placed ahead of New Zealand, and both Singapore and Australia are independent countries. New Zealand has been in the top six since the mid 90s.
Other countries not included which could be considered more economically free include Isle of Man, Luxembourg, Andorra, and Liechtenstein.
Me too.
Compare Hong Kong to Belize, both were British colonies for roughly the same time period, both encompass relatively small areas, both have good locations for being ports of trade, both have a diverse population. The Brits mostly kept their hands off of Hong Kong while virtually locking up development in Belize. Today Hong Kong shines while Belize’s embers remain faint.
Better yet, compare Switzerland, a land-locked, mountainous, free market country with a country with a small population relative to its vast natural resources: Russia. Despite all of Russia’s natural advantages, the Swiss have far higher living standards than Russians. A similar example could be made with Ukraine, which should be the breadbasket of Europe.
Which timeframe are you looking at?
Johan Norberg has written a book “When Mankind Created the 'World” it is about the last 200 years of development and how capitalism finally defeated poverty. If you are looking in a shorter perspective I would imagine poverty data to be difficult to. Cause there is no poverty in the west so noone measure it … just “relative poverty”.
What exactly is absolute, abject poverty? I understand relative poverty is silly, but how can we eradicate poverty without defining it first?
You compared areas of similar geographic attributes.
May you show me a place of poor geography but good economic policy and compare it with a place of good geography but bad economic policy?
How about you compare highly statist Saudi Arabia and Russia and place them next to free market Chile? Chile has a smooth coastline, and not a frequently bending one which can create harbours to put boats away from open seas, while Saudi Arabia has access to a large number of bending coastline-based regions from where it can transport its oil.
I think quite a long data set is needed because the most important thing to show is what happens to a country over time as it moves toward or away from capitalism. I think 100 years of data would be more than sufficient. I hope the 15 years worth of data (thanks to other Mises forum members for the link) will be good enough. I’ll be sure to take a look at the Johan Norberg book you suggested.