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By Lawrence W. Reed
A few hundred meters south of the demilitarized
zone (DMZ) in South Korea sits the gleaming new
Dorasan train station. Spacious, brightly lighted,
and modern in every way, it lacks only two not-so-minor
details: passengers and trains.
The Dorasan station is a symbol of hope, hope for
the day when the peoples of the two Koreas are both
free and united. When that day comes, trains will
carry passengers back and forth across the impenetrable
and forbidding border that now divides the communist
North from the free and democratic South.
By Bienvenido S. Oplas, Jr.
Should governments be allowed to charge high income
tax rates, or should citizens have the freedom and
choice on how they should spend their earnings and
savings?
The Indonesian Institute, Center for Public Policy
Research has recently released Indonesia 2006,
an annual publication that provides a rich overview
of Indonesia’s socio-political environment.
by Rainer Heufers
The debate whether governments should interfere
in the markets to establish large national corporations
is ever present. These so-called “national
champions” are giant corporations which are
supposed to acquire immense competitiveness that
creates growth and employment in the national economy
and also enhances the national reputation abroad.
But is it really as good as it sounds?
based
on the Economic Freedom of the World 2006 Report
Economic freedom has its own prices and rewards.
It comes at the price of a government having less
control over business, financial and market systems.
Its rewards are for private enterprises to enjoy
less bureaucracy and more freedom to enter and compete
in local and international markets.
Development and freedom are inseparable. Economic
freedom and overcoming poverty are possible only
in a free economic environment. The Friedrich Naumann
Foundation produced a brochure containing an overview
of each annual conference organised by the network
from 1998 to 2006.
based on the Economic Freedom of the World 2006
report
Freedom is one of best gifts that a government can
give to its citizens. Economic freedom is the freedom
to create wealth. Not surprisingly, results of empirical
researches show that as economic freedom increases,
so do per capita income, economic growth rate, literacy
rate, employment rate and life expectancy. They
also reveal that countries with more economic freedom
also have a lower rate of infant mortality and a
fewer instances of child labour.
IPRI measure of seventy countries shows economic
benefits of strong legal protection for land, inventions
and other private property.
The recent study “Economic Freedom in the
German Federal States” ("Wirtschaftliche
Freiheit in den deutschen Bundeslandern")
published by the Liberal Institute of the Friedrich
Naumann Foundation finds a strong correlation between
economic freedom and wealth. The index examines
the degree of economic freedom in the 16 federal
states of Germany.
By
Kai Jäger
This paper illustrates the basic concepts of free
trade and tries to debunk the arguments of free
trade opponents. It shows that every trade is a
win-win-situation and that a country which has opened
its borders to free trade will benefit as a whole.
Popular fallacies that free trade destroys domestic
jobs or infant industries and is a danger for the
national defense will be refuted and the role of
so-called “neo-liberal” institutions
will be analysed critically from a genuine liberal
background.
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By Dr Khalil Ahmad
Whoever said money can't buy happiness didn't know
where to shop!
Generally, there are perennial complaints of dearness
and high prices of various items by the opposition
and people at large and with the advent of Ramazan
every year, this hue and cry intensifies. Media
has its own part to play in this drama. Obvious
enough, this issue of high prices plays a very crucial
role in the politics of elections in Pakistan. It
seems that political parties, both ruling and opposition,
put forward such slogans as if they will freeze
prices and make promises that they will bring prices
back to the level of such and such date.
by Sarinthorn Sachavirawong
The benefits of free trade have been proven, with
empirical studies, to increase wealth and economic
growth for nations. Even the UNDP Asia-Pacific Human
Development Report 2006 acknowledges the impact
trade has on human development. The report states
that the rapid increase in trade has had the impact
of a substantial decline in poverty in the Asia
Pacific region. It cites that "liberalising
agricultural markets have helped reduce the price
of food",
and that "the
period of trade-led growth has been accompanied
by improvements in health..."
by Bienvenido Oplas, Jr.
This paper explains how free trade benefits all
parties that are engaged in it. The consumers in
richer countries are saving money from buying cheaper
goods from poorer countries, while new jobs are
created in the poorer countries which help to alleviate
poverty there. Also, in an integrated world economy,
there is less probability of huge price fluctuations
because free trade results in commodity price equalisation
across all participating countries.
On the other side, Oplas shows that all kind of
protectionist controls like tariffs, quotas, or
export subsidies have a negative impact on welfare
and that only particular interest groups benefit
from it. He reveals the confusing double standard
that is applied by producers who want their own
goods to be protected from competition.
Moreover, the success of the ASEAN Free Trade Area
(AFTA) is discussed as well as possible trade policy
alternatives to achieve more liberalisation.
by Parth J. Shah and Ali Mehdi
Malaysian development, which has emulated the outward-looking
East Asian miracle, is a classic example of using
strategic, carefully sequenced trade liberalisation
to promite economic growth, poverty reduction and
human development.
by Richard Leete, United Nations Development
Programme (UNDP)
Malaysian development, which has emulated the outward-looking
East Asian miracle, is a classic example of using
strategic, carefully sequenced trade liberalisation
to promite economic growth, poverty reduction and
human development.
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by Philip Stevens
The rise of the multilateral trading regime under
the auspices of the GATT and later the WTO has contributed
to a massive liberalisation in global trade that
has seen new health knowledge and technologies,
and wealth, spread to nearly all corners of the
globe.
Nevertheless, multilateral trade agreements from
TRIPS to GATS have been met with scepticism from
self-styled health activists and campaigners, who
accuse them of holding up technology transfer and
even disenfranchising the poor.
But are such allegations grounded in reality? Philip
Stevens argues not. Instead, free trade is a powerful
mechanism for improving the health of the world’s
poor. It leads to enhanced competition, which drives
improvements in products and processes – leading
to economic growth. It also enables ‘technology
transfer’, ensuring that advances made in
one market rapidly become available elsewhere.
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by Julian Morris
Globalisation opponents often refer to morality
when they are attacking free trade. Julian Morris
shows that nothing can be more wrong: Restrictions
on trade are immoral, because they undermine sustainable
development by raising the costs of goods, harming
especially the poorest, and they act as barriers
to employment and entrepreneurship.
On the other side, voluntary exchange between individuals
is inherently good. Each and every trade directly
enhances the welfare of both participants. Cumulatively,
such trades drive entrepreneurial processes that
lead to more, better and cheaper products being
available, and increase productivity. In combination,
these result in sustained development, leading to
continuous improvements in human welfare.
Morris calculates that the removal of all tariffs
and quotas on goods and services could increase
World GDP by over one trillion dollars annually
and especially the poor in Africa and Asia would
benefit from such a policy.
by Alec van Gelder
Because wealthy countries have highly developed
information and communication technologies (ICTs),
some argue that increasing access to these technologies
will make poor countries wealthy.
But according to van Gelder, the same barriers
that prevent poor countries from becoming wealthy
also prevent the poor from accessing ICTs. Attempting
to correct for the so-called ‘digital divide’
by subsidising the provision of ICTs is unlikely
to be successful.
The digital divide is actually part of a larger
‘dirigiste divide’ which results from
the governments of poor countries imposing all manner
of restrictions on entrepreneurial activity.
This paper argues that without markets underpinned
by strong, transferable property rights, free trade,
and the rule of law, entrepreneurs can not make
the investments that are required to expand provision
of ICTs.
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