De Soto argues that because of legal barriers and because it is often unclear who owns what property, poor people in those countries cannot utilize their assets to produce more wealth. According to Hernando de Soto, much of the poverty in Third World countries is caused by a lack of Western systems of laws and well-defined and universally recognized property rights. Siegan holds that a secure system of property rights also reduces uncertainty and encourages investments, creating favorable conditions for an economy to be successful. Harper argues that a system of private property is required for entrepreneurship, because "entrepreneurs would not be able to formulate or carry out their plans unless they were reasonably sure that the people with whom they trade have exclusive control over the relevant resources." Bernard H. Such systems include two main rights, namely the right to control and benefit from property and the right to transfer property by voluntary means. In the 1960s, Alan Greenspan argued that economic freedom requires the gold standard for protection of savings from confiscation through inflation Īccording to the liberal free-market view, a secure system of private property rights is a necessary part of economic freedom. Liberal viewpoint Institutions of economic freedom Private property rights With regards to other measures such as equality, corruption, political and social violence and their correlation to economic freedom, it has been argued that the economic freedom indices conflate unrelated policies and policy outcomes to conceal negative correlations between economic growth and economic freedom in some subcomponents. Based on these rankings, correlative studies have found higher economic growth to be correlated with higher scores on the country rankings. There are several indices of economic freedom that attempt to measure free market economic freedom. This is embodied in the rule of law, property rights and freedom of contract, and characterized by external and internal openness of the markets, the protection of property rights and freedom of economic initiative. The liberal free-market viewpoint defines economic liberty as the freedom to produce, trade and consume any goods and services acquired without the use of force, fraud, theft or government regulation. Other conceptions of economic freedom include freedom from want and the freedom to engage in collective bargaining. Another approach to economic freedom extends the welfare economics study of individual choice, with greater economic freedom coming from a larger set of possible choices. One approach to economic freedom comes from the liberal tradition emphasizing free markets, free trade, and private property under free enterprise. This is a term used in economic and policy debates as well as in the philosophy of economics. Economic freedom, or economic liberty, is the ability of people of a society to take economic actions.
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