FAYETTEVILLE, Ark. - A new study by University of Arkansas economists shows a strong relationship between economic freedom and access to water.
Using a comparison of data from two important international indices, the study found that greater economic freedom leads to economic development, which in turn decreases the amount of poverty associated with a nation's lack of access to water.
The study was conducted by David Gay and Charles Britton, economics professors in the Sam M. Walton College of Business, and Richard Ford, professor of economics at the University of Arkansas at Little Rock.
"When humans are free to improve their economic conditions, one of the conditions they choose to improve is their access to water," Gay said. "So, based on our findings, we conclude that one means of improving humanity's conditions with respect to access to water is to promote economic freedom on a global basis."
The research was sparked by publication of the Water Poverty Index by the United Kingdom's Centre for Ecology and Hydrology and also motivated in part by the efforts of former U.S. Treasury Secretary Paul O'Neill and rock star Bono, who toured sub-Saharan Africa together and agreed on the critical importance of clean water to people in that region.
To compare water poverty to economic freedom, Gay and his colleagues used the Heritage Foundation's Index of Economic Freedom, which defines economic freedom as "the absence of government coercion or constraint on the production, distribution, or consumption of goods and services beyond the extent necessary for citizens to protect and maintain liberty itself." Stated differently, it is an economic system in which people are free to actively participate -- to work, produce, consume and invest in ways they think are most productive.
The researchers looked at gross domestic income per capita as a measurement of economic development and found a "statistically discernable" relationship between the variables of economic freedom and development. Their results demonstrated that as a country's economic freedom increased, there was a corresponding increase in gross domestic income per capita. Additonally, the researchers found that as income levels increased within a country, there was more access to water and less water poverty in general.