There are many factors that account for a country’s economic freedom (or lack thereof), but one of the most overlooked is the role of religion.
Can economic freedom be explained by religion, independently of political institutions? That’s the question researchers at an economics think-tank in Germany attempted to answer. Their findings:
We investigate whether religion affects economic freedom. Our cross-sectional dataset includes 137 countries averaged over the period 2001-2010. Simple correlations show that Protestantism is associated with economic freedom, Islam is not, with Catholicism in between. The Protestant ethic requires economic freedom. Our empirical estimates, which include religiosity, political institutions, and other explanatory variables, confirm that Protestantism is most conducive to economic freedom.
The researchers found that there is something to Max Weber’s claim about a Protestant Ethic after all:
Historically and traditionally, the emotional need of Protestantism to overcome the anxiety of personal uncertainty regarding predetermination required economic freedom. Even if religiosity in contemporary Protestant populations is low, the legacy of the Protestant Ethic is economic freedom for individuals to be conscientiously productive.
The researchers also conclude:
Because economic freedom is a requisite of economic progress, our results imply that the religious composition of a population and religiosity can affect economic development and incomes. The religious composition of a population and religiosity in general change only slowly, through differential fertility in different religious groups. Large-scale migration can however result in abrupt change in religious composition and religiosity among a country’s population. Our results suggest that religion and religiosity of immigrants can have consequences for economic freedom.
So if you want more economic freedom in your country, import more of us Protestants and encourage us to have more babies.