Comparing Friedman's Capitalism And Freedom

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We have talked a lot about political institutions as a way for a country to increase per capita income, and although that is very important, economic institutions are often as big of a factor. I’m a strong believe that in order to see sustained increase in development strong political institutions need to be in place. With that being said economic institutions play a huge role in the long-term success of sustained development. In Friedman’s Capitalism and Freedom, he argues that economic freedom lead to political freedoms. A modern day example of this is the role businesses and corporations play in lobbying for policy. Politicians just like everyone else want to maximize their own utility, and they do that by staying in office. So when businesses …show more content…
But even though I am a strong belief in institutions being a fundamental aspect for development there are cases where that is not the case. Greece for example is considered a more “developed” country in the world. They belong to the European Union but since 2009 the country has been struggling economically. According to the International Monetary Fund, Greece is 44th in the world in per capita income. Many would argue that 44th out of 187 serves to show that Greece is pretty developed and I would agree. However I chose this example because even though Greece has a decent institutional foundation, the amount of debt they encompassed and the Great Recession has caused them to back slide dramatically. Even with a strong foundation sustained development is not an easy task. Another example of a country that has sustained increasing per capita income is that of Uganda. Uganda is one of the poorest countries in the world but over the past 5 years has seen a substantial continual increase in average income. Uganda is most notable know for their devastating civil wars, which indicates a lack of political institutions. So why have they seen this continual growth? There are lots of possibilities for example better change in economic policy, abundance of natural resource or maybe even foreign aid. Uganda has consistently been one of the top 20 countries in the world to receive aid in last few years. Do I think this is the reason why they have increasing per capita income? Of course do not I think this is the whole reason but I think it has played a significant role in their progression. Uganda does not have very strong economic institutions, but in the last three years the economic policy has been credited with improving drastically. Foreign aid alone is not the reason Uganda has had increased per capita income, but it’s not hard to

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