Saturday, January 07, 2006

Useless "Economic Freedom Index" Once Again Published

The Heritage Foundation have again issued a new version of its Economic Freedom Index. The problem is that the index uses a deeply flawed methodology, as I explained in my article on last year's version. The errors that last year's index contained seem to have been largely uncorrected, apart from the false factual claim that Denmark's top income tax rate is 26.5% (when it's really 59%, as they concede now).

One would have thought that a index which absurdly claims that the "Fiscal burden" (i.e. the burden from taxation and government spending) in the notorius welfare states Denmark and Sweden is lower than in the United States, Australia or China would be dismissed out of hand.

Bbut unfortunately, prominent Swedish free market advocates like Johnny Munkhammar and Johan Norberg uncritically praised the index. Which is particularly curious in the case of Norberg, as he himself noted some of the flaws a year ago.


Anonymous Johan Norberg said...

I have not "uncritically praised the index". I have used one interesting fact from the index. And I don't see how that fact would be falsified by the reservations that you and I have about the index.

Best wishes,

10:25 PM  
Anonymous Johan Norberg said...

I have not "uncritically praised the index". I have used an interesting fact from it, and I can't see that one being wrong, based on the problems of the index that you (and I) have pointed out.

Best regards,

11:08 PM  
Blogger Ryan J said...

I just recently blogged on the Economic Freedom Index as well.

Although I would be unaware of some of the flaws you mention since I know very little about some of the countries you mention I would still hope that you (as a believer in Free Markets) would be thankful at least that this is being addressed.

10:12 PM  

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