According to the report Economic Freedom of North America 2023.
"Puerto Rico needs public policy reforms that will improve the situation of economic freedom on the island," said Ángel Carrión Tavárez, director of Research and Public Policy at the Institute for Economic Freedom and co-author of the report. (Supplied)
Puerto Rico was ranked as the jurisdiction in the United States with the least economic freedom, or the right to generate income in an occupation of free choice without unnecessary government interaction.
The ranking was established by the Economic Freedom of North America 2023 report, published by the Fraser Institute of Canada, which measures the degree of economic freedom in 93 provincial and state governments in Canada, the United States and Mexico.
"Puerto Rico needs public policy reforms to improve the situation of economic freedom on the island, that is, to make it easier for people to participate in the economic sphere, without undue government interference or obstacles," said Ángel Carrión Tavárez, director of Research and Public Policy at the Institute for Economic Freedom and co-author of the report.
In the U.S. subnational index, New Hampshire ranks first as the state with the greatest economic freedom, with a score of 7.96 (out of a maximum of 10); and Florida, with 7.80. Rounding out the top five freest states are Tennessee (7.73), Texas (7.64) and South Dakota (7.59).
At the low end of the index, Puerto Rico ranked 51st with 2.85. The state with the lowest score was New York with 4.09, 43% higher than the island, followed by California (4.27), Vermont (4.27), Oregon (4.56) and Hawaii (4.58).
"Economic freedom is fundamental to people's well-being and prosperity. Many of the socioeconomic problems faced by Puerto Rico residents such as high unemployment, low wages, dependency and outbound migration are related to the lack of economic freedom on the island," added Carrión Tavárez.
In addition to being below the United States in the three-country index, Puerto Rico ranked 0.82 below the lowest-ranked Canadian province (Newfoundland and Labrador) and only 0.08 above the highest-ranked Mexican states (Baja California and Chihuahua). This means that, in economic freedom, Puerto Rico is closer to Mexico than to the United States and Canada.
In addition to Carrión Tavárez and Stansel, the report was composed by José Torra and Fred McMahon and with scores based on data from 2021, the year with the most recent complete information available.
"Hundreds of independent studies have provided compelling evidence that higher levels of economic freedom are associated with more opportunity, more prosperity, higher economic growth and more jobs," said Dean Stansel, research associate professor in the Cox School of Business at Southern Methodist University and also a co-author of the report.
This article was originally published in Spanish in Primera Hora.
