Economic freedom and economic growth: A panel data analysis for developed and developing countries

In this thesis study, it is aimed to analyse the relationship between economic freedoms and economic growth for OECD countries and upper middle-income countries, including Turkey. At this point, firstly, the concept of economic growth and economic growth theories are analysed in the context of economic theory. Then, the literature on the concept of economic freedom, its importance and how it is measured is included. Within the scope of the study, the existence of short and long term relationships between each of the components of economic freedom and economic growth was investigated in practice. In this connection, for the two sample groups in the study, a panel data set covering the period 1995-2024 has been created for the components of economic freedom and economic growth for which reliable data are available. In the application part, Dumitrescu and Hurlin (2012) Granger Panel Causality test was used to test the existence of short-run relationships and Westerlund (2007) Panel Cointegration test was used to test the existence of long-run relationships. As a result of the analyses, it is concluded that there is both a short-run and a long-run relationship between GDP per capita, which is an indicator of economic growth for OECD countries and upper-middle-income countries, and the general economic freedom index as well as the components of economic freedom; property rights, government integrity, tax burden, government expenditures, freedom of doing business, monetary freedom and freedom of trade variables in the period 1995-2024.