This study examines the relationship between economic freedom (dependent variable) and specific determining factors (independent variables). It is a time series study covering 15 years. Following the quantitative research tradition, and employing the GLM procedure, it has been observed that most of the independent variables impacted the dependent variable. The study affirms that economic freedom is very important for investment. The theoretical framework, in particular the institutional theory, has highlighted the importance of enforcing rules and regulations in order to safeguard economic freedom. The panel regression results show that factors such as a diminished level of political freedom or a retarded level of human development can negatively affect economic freedom. This may result in low levels of investment, thereby discouraging entrepreneurial capabilities.
Economic freedom, investment, citizens’ well-being, empowerment, public policy