The Impact of Economic Freedom on Economic and Environmental Performance: Evidence from European Countries

Jonas Rapsikevicius, Jurgita Bruneckiene, Mantas Lukauskas and Sarunas Mikalonis
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Jonas Rapsikevicius: School of Economics and Business, Kaunas University of Technology, 44239 Kaunas, Lithuania
Jurgita Bruneckiene: School of Economics and Business, Kaunas University of Technology, 44239 Kaunas, Lithuania
Mantas Lukauskas: Faculty of Mathematics and Natural Sciences, Kaunas University of Technology, 44239 Kaunas, Lithuania
Sarunas Mikalonis: School of Economics and Business, Kaunas University of Technology, 44239 Kaunas, Lithuania

Sustainability, 2021, vol. 13, issue 4, 1-20

Abstract: The EU Green Deal and its impact on economic transformation provoked a slightly forgotten free market vs. market regulation discussion, but in the light of a new context—economic and environmental performance development. The economic shock caused by COVID-19, which transformed economies and societies, intensified this discussion. This article analyses the impact of economic freedom on economic performance and environmental performance in European countries. The article contributes to a gap in the literature, because, to date, research has examined the effects of economic freedom, or some of its components, on economic or environmental measures in groups of nations with a lacking sustainable development context. In addition, the mixed results obtained led to confusion in perceptions and knowledge about the influence and usefulness of economic freedom for economic and environmental performance. We also found mixed results regarding the influence of economic freedom on economic and environmental performance, but the introduction of a new concept—the optimal level of economic freedom—organized the different results into a coherent logical sequence. The paper provides original empirical evidence and specifies the targets of structural reforms. The results are thus useful for policymakers to develop more appropriate and efficient economic freedom.

Keywords: economic freedom; economic and environmental performance; structural reforms (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:13:y:2021:i:4:p:2380-:d:504103

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