Abstract
Using data from 1972 to 2011 on 109 countries, this paper empirically studies the impact of economic freedom on human capital investment. Enrollment in secondary education is used as a proxy for such investments. Controlling for a large number of other determinants of education, it finds that, over the sample period, economic freedom had a substantial positive effect. This is probably because more economic freedom increases the return on investing in human capital, enables people to keep a larger share of the return, and, by facilitating the operation of credit markets, makes it easier for them to undertake such investments in the first place.
Original language | English |
---|---|
Pages (from-to) | 421-445 |
Number of pages | 25 |
Journal | Journal of Institutional Economics |
Volume | 13 |
Issue number | 2 |
Early online date | 17 Oct 2016 |
DOIs | |
Publication status | Published - Jun 2017 |