Evaluating the effect of Economic Freedom and other Factors on the Economic Prosperity of Nations
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In this paper, we aim to discuss the effects of variety of different economic freedom factors on real GDP (Gross Domestic Product) per capita of a country based on our initial hypothesis - higher the degree of economic freedom, higher the level of economic activity and hence the higher the per capita real GDP level. We will also evaluate the extent by which various economic freedom indexes affect a country’s economic well-being to determine which freedom indexes have stronger effect on the GDP per capita of a country compared to the others. Having identified the stronger and more impacting economic freedom indexes, we will try to improve the econometric model by using variable selection methods and possibly non-linear regression methods to further understand the relationship between per capita GDP and the economic freedom factors that affect it.