Impact of Economic Freedom and Financial Freedom on Economic Growth: Evidence from Saarc Countries

Abstract

This study analyses the impact of economic freedom and financial freedom on economic growth of SAARC nations. We collected data for the period 1995-2021.We use SAARC countries as a sample, which includes Pakistan, India, Bangladesh and Srilanka. Data were collected from World Bank & Economic freedom heritage of concerning countries. We applied several econometric techniques to analyse the data, including Correlation analysis, descriptive statistics, Unit root analysis, and regression. All the variables are found stationary at first difference. The results show that economic freedom is positively and significantly related to economic growth of SAARC countries. Financial freedom is also found significantly and positively related with economic growth. Empirical evidence suggests that presence of free private markets where peoples make decision on their choice is exceptionally helpful to growth in SAARC countries.