Unrest is spreading throughout the Arab world after last week’s overthrow of the Zine el-Abidine Ben Ali regime in Tunisia. Demonstrations have erupted in Egypt, Morocco, Algeria, and Yemen. Many news reports are identifying high unemployment and endemic poverty as causes of the protests.
Yet that begs the question: why are these countries suffering from high unemployment and endemic poverty? Economic logic suggests that the most likely culprit of these ills is the lack of economic freedom. Â The available evidence, just as one would expect, coheres with this logic.
That evidence comes from the Economic Freedom Index. Published by the Heritage Foundation and The Wall Street Journal, this index assesses nations on ten measures, including their protection of property rights, the liberty afforded to firms and individuals to engage in domestic and foreign trade, and the weight of government in the economy. The index correlates very strongly with the varying economic growth rates that countries experience.
So how do the nations mentioned above fare in terms of economic freedom? Not very good. Among 179 countries ranked in the 2011 edition of the index, Tunisia comes in 100th place. Morocco is 93rd, Egypt is 96th, Yemen is 127th, and Algeria is Â 132nd.
Therein lie the roots of Arab unrest.