Wise Technocrats or Black Helicopters? Intergovernmental Organizations and Economic Freedom

Abstract

This paper explores the relationship between country membership in major intergovernmental organizations and economic freedom. While claiming no broad theoretically-bound robust causal mechanism, I use fixed effects models to find baseline results finding a correspondence between economic freedom and membership in the EU, NATO, WTO, UN, OECD, World Bank, and IMF. While the results are not simple, the strongest findings are negative effects of the UN, IMF, and WTO, and positive effects of the World Bank and possibly the EU. I make no claims of causality. However, whatever the relationship could be endogenous to, for example the international openness of governments, is yet of interest.

Keywords: Economic Freedom, Economic Institutions, European Union, NATO, World Trade Organization, United Nations, OECD, World Bank, IMF

JEL Classification: P48, F50, F53