It is argued that economic freedom and prosperity go hand in hand with improved health and health care, lower infant-mortality rates, better education, cleaner water, and improved sanitation.
Greater economic freedom correlates with better outcomes in schools (both public and private), higher literacy rates, lower infant-mortality rates, longer life expectancy, a cleaner and safer environment.
In 2013, The Heritage Foundation published a special report from The Centre for International Trade and Economic (CITE) titled: “How Economic Freedom Promotes Better Health Care, Education, and Environmental Quality” which submits that “ironically, it is countries that reject economic freedom that produce inferior social goods.
“Higher quality social goods are created when consumers have a greater variety of choices – which are created through genuine free-market competition. It is through competition and choice – basic tenets of economic freedom – that countries, especially in the developing world, create best opportunities to earn a higher quality of life for their citizens.”
The study authors, James M. Roberts and Ryan Olson conclude that there is compelling evidence as discerned from the Index of Economic Freedom that there are vast benefits accruing to increased economic freedom despite critics who hold fast to the notion that “economic freedom has been a failure.”
A frequent charge is that governments that prioritize policies such as low tax rates, impartial rule of law, strong private property rights, and unfettered access to markets generally fail to provide citizens with adequate health care, education, and clean environments. However, the authors in their view hold that the results of the Index of Economic Freedom tell quite a different story.
What is economic freedom in a nutshell and how it measured? According to the Heritage Foundation, economic freedom is the fundamental right of every human to control his or her own labour and property. In an economically free society, individuals are free to work, produce, consume and invest in any way they please. In economically free societies, governments allow labour, capital, and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself.
Economic freedom brings greater prosperity. The ideals of economic freedom are strongly associated with healthier societies, cleaner environments, greater per capita wealth, human development, democracy and poverty elimination.
Economic freedom is also defined as the independence experienced by individuals within a given society to pursue their interests. It is the liberty to engage and make choices about economic activities and endeavours.
In the local context, Botswana is the third most economically free country in Sub-Saharan Africa region as encapsulated in the 2020 World Economic Freedom Index. With a score of 69.6 percent, Botswana ranks 40th freest country in the world and third out of 47 countries in the Sub-Saharan Africa region, and its overall score is well above the regional and world average.
The Heritage Foundation report which is produced annually categorizes the level of economic freedom of a country by evaluating four parameters of open markets, rule of law, government size and regulatory efficiency.
According to the report, Botswana’s overall score increased by 0.1 percent, aided by an improvement in fiscal health and that for Botswana’s economy to return to the ranks of the mostly free, the government will have to implement deep, broad, and well-institutionalized reforms to improve government transparency, ensure the impartiality and efficiency of judicial decision-making, and undertake a serious review of the country’s many state-owned enterprises with a view to privatisation of those that are engaged in purely commercial activities.
According to the economic freedom study above referenced, it is acknowledged that while most can agree on basic standards of literacy and other requirements for an educated citizenry facing the demands of the 21st century, the reactionary policies of the education “establishment” in government and academia are generating negative educational outcomes.
Instead, government policy makers need to take a serious look at policies that embrace economic freedom. It is generally agreed that higher rates of literacy are prerequisites for economic growth. Literacy improves the human capital within a country, qualifying individuals for jobs that require better training and have higher wages. This subsequently contributes to increased growth.
Research has found that “the fastest economic breakthroughs are achieved by those countries that have already attained sufficiently high levels of literacy”. Correspondingly, high literacy levels have a strong relationship with per capita gross domestic product (GDP), making them a key factor in long-term growth.
It is further lamented in the study that “nowhere in the world is the problem of illiteracy worse than in Sub-Saharan Africa. A 2020 study by the U.N. Educational, Scientific and Cultural Organization (UNESCO), found nine out of the 20 Sub-Saharan African countries studied had literacy rates below 50 percent. In Burkina Faso, the worst case, less than one-third of the population is literate. Thus, it is not surprising that Sub-Saharan Africa has the lowest regional score in the 2013 Index of Economic Freedom, at 53.7 (of 100).”
However, there is hope – if countries stick to the principles of economic freedom that can lift their populations out of the illiteracy trap. In the 1990s, Rwanda was ravaged by civil war and genocide, which was estimated to have killed almost one million people. After the violence subsided, the new government led by Paul Kagame initiated a rapid set of reforms that embraced the principles of economic freedom
The result has not been just growth in prosperity, but a marked improvement in literacy. There has been a jump from a literacy rate of 60 percent of people who could read and write by 1990 to over 70 percent by 2010.
“This jump was accompanied by remarkable gains in economic freedom. In 1997, the first year that Rwanda was graded in the Index, the country scored a paltry 38.3. By 2013, Rwanda had scored 64.1, a remarkable 67 percent increase in economic freedom. The U.N. predicts that if current conditions persist, Rwanda will continue to make gains in literacy through to 2015, and possibly beyond,” states the research study.
It is also acknowledged in the study that of all social goods, health care has historically proved to be amongst the most difficult challenges for policymakers. Health care services are often costly, are sometimes distributed unevenly, and financial services such as private health insurance have sometimes been inefficiently regulated.
“Policymakers should let economic freedom lead the way for better health outcomes. By empowering individuals and letting them to control their own insurance and health services, policymakers can return power to the consumers and put their health back in their hands”, the study advises adding that “by embracing these principles of economic freedom, governments throughout the world can help their citizens live longer, healthier lives.”
