Areas of Economic Freedom of the World (EFW) - Essay Example

Answer 3: Areas of Economic Freedom of the World (EFW Business Freedom: Business Freedom refers to the ability of a person to manage a businessin accordance with the government-imposed rules, laws, and regulations concerning businesses. Trade Freedom: Trade Freedom is the second main area of EFW that relates to the freedom one can enjoy while operating the business of import and export. Monetary Freedom: Another area of EFW is Monetary Freedom that reflects the combination of price control and price stability within the economic environment of a country.

Government Size/Spending: Government Spending refers to the extent to which the government spends at local, federal, and state level and is measured as a percentage of GDP. Fiscal Freedom: This area of EFW refers to the extent to which an individual or a business enjoys tax reduction/exemption by the government. Property Rights: This area of EFW refers to the ability of an individual to build up private property in accordance with the government-imposed laws. Investment Freedom: This area refers to the extent to which an individual can make capital investments inside and outside the country without any restriction.

Financial Freedom: This area measures banking efficiency, as well as the extent to which an individual can enjoy financial independence from the financial sector and the government. Freedom from Corruption: This area of EFW refers to the extent to which a state enjoys economic freedom that results due to reduced level of corruption. Labor Freedom: This area of EFW analysis the labor market based on a country’s legal and regulatory framework for labor market.