This year’s report notes that economic freedom suffered its first setback in decades. The average economic freedom score rose from 5.55 (out of 10) in 1980 to 6.70 in 2007, but fell back to 6.67 in 2008, the most recent year for which data are available. Of the 123 countries with chain-linked ratings in 2007 and 2008, 88 exhibited rating decreases and only 35 recorded rating increases. In this year?s index, Hong Kong retains the highest rating for economic freedom, 9.05 out of 10, followed by Singapore, New Zealand, Switzerland, Chile, the United States, Canada, Australia, Mauritius, and the United Kingdom.

This year’s report also contains new research showing the impact of economic freedom on unemployment rates and homicides. According to Horst Feldmann, more economic freedom appears to reduce joblessness, and the magnitude of the effect seems to be substantial, especially among young people. Edward Peter Stringham and John Levendis examine the effect of economic freedom on rates of homicide in Venezuela, Colombia, South Africa, Latvia, and Lithuania. The results suggest that increases in economic freedom lead to decreases in homicides.