The Effect of Trade Barriers and Governmental Regulation on Overall Economic Well-Being
MetadataShow full item record
Barriers to trade and other market regulations have long been thought to inhibit the ability of a nation’s economy to grow and prosper. We test this hypothesis using a multiple regression model and data from The Heritage Foundation and United Nations related to trade freedom and general economic regulation on a by-country basis to fully discern the impact of governmental regulation on a country’s GDP per capita. We find that GDP per capita rises significantly as a nation’s business freedom and trade freedom grow and that a nation’s status as developing or developed has additional bearing on GDP per capita. This provides strong confirmation for our hypothesis that deregulated economies experience higher levels of economic prosperity as measured by GDP per capita than their regulated counterparts and indicates that a market-specific look should be taken to fully understand the nuances of the results of different types of economic regulation.