Welcome, I'm Anastasia Glova bringing you the Cato Daily Podcast.

Full and edited versions of our podcasts are available on our website at

W.W.Cato.org.

Today, the Cato Institute, in conjunction with the Frazier Institute in Canada

released the Economic Freedom of the World 2006 annual report. New research

for this report shows that economic freedom can help lift nations out of poverty and that foreign aid

and democracy are significantly less effective in building peace and prosperity.

Director of the Project on Global Economic Liberty, Ian Vaskas, discusses the new report in today's

podcast. What are some of the most crucial factors that contribute to economic

freedom? Countries have economic freedom when their economies have a great degree of personal choice, when they're characterized by voluntary

exchange and the freedom to compete, and when there's protection of persons and property.

To the extent that countries have those ingredients, they're economically free.

To the extent that they have more of those, they're more economically free and most countries

have a mixed record.

The project to measure economic freedom around the world

is an attempt precisely to measure those ingredients.

And the authors of the report look at five basic areas, the size of government,

the rule of law, access to sound money, freedom to exchange with foreigners and the regulation of business and credit and so on.

And they look at 38 different variables.

In this year's report we're looking at 130 countries around the world,

going back to the extent possible to 1970.

This is a project that the Frazier Institute began in the 1980s and we began publishing this

...