ABSTRACT
This chapter discusses the determinants of economic freedom by seeing how specific determinants contributed to institutional convergence from 1980 to 2010. It contributes to the literature on exit versus voice in determining the quality of institutions. The chapter focuses on the relationship between economic freedom and growth. This literature almost uniformly shows that an institutional environment more consistent with economic freedom is conducive to long-term growth. In the growth literature, there is a large body of work on the convergence of incomes across countries or regions. An important addition to this literature is the work of Brown, building on the work of Diamond, who briefly notes that the shapes of Europe and China could have influenced their institutional development. The ß-convergence of economic freedom across US states could be estimated to see if states were converging or diverging in terms of institutional quality since 1980.
