Economic freedom is measured by: Fraser Institute EF Index There is a high correlation with GDP per capita. Alvarez, Geloso, and Scheck show that the correlation is even higher when you take into account the fact that dictators lie!
SSRN: Literature linking indices of economic freedom with income levels and growth generally points to a positive association. In this paper, we argue that this result is very conservative because the data are highly biased in finding an effect. This bias appears as a result of the tendency of dictatorships to overestimate their GDP levels. Dictatorships also tend to have low economic freedom scores. This biases estimates of the relationship between income and economic freedom downward. In this paper, we estimate the bias using recent revisions to GDP figures based on night-time light intensity. We find that the real effect of economic freedom on income levels is 1.1 to 1.33 times larger than commonly assumed. For economic growth, the bias is much smaller and appears to be related only to some individual components, such as government size and property rights.
