According to the Atlantic Council’s latest Freedom and Prosperity Indexes, political freedom has declined worldwide for the twelfth consecutive year, bringing the global average in political rights to its lowest level since 1999. The erosion is a “generalized trend that affects countries at all levels of development” across all world regions and all indicators, including free and fair elections, civil liberties, political rights and legislative constraints on the executive.
The Atlantic Council’s framework comprises two composite indices: the Freedom Index, which equally aggregates political, legal (rule of law), and economic freedom, and the Prosperity Index, which includes income, health, education, inequality, minority inclusion, and environmental sustainability. Across 164 countries, the two indexes show a correlation of 0.71 for 2024, linking freedom and prosperity.
Overall, the report finds that the world is becoming more prosperous even though treatment of minorities, a component of the relevant index, has worsened in the past decade, in particular in South and Central Asia.
However, the report highlights that “a dangerous belief has taken root globally: that political freedom is not essential to prosperity and may even be an obstacle to economic growth.” This narrative “is not supported by rigorous empirical evidence”, the study says.
Using a statistical technique called “local linear projections,” the report concludes that, twenty years after a significant increase in political freedom, a country’s per‑capita GDP is on average 8.8 percent higher than it likely would have been had it remained autocratic. In other words, this is a relative increase compared to similar countries that did not democratize.
Over a long period, democratization leads to more economic prosperity
Among freedom dimensions, rule of law exhibits the strongest link to prosperity, especially income per capita, according to the Atlantic Council. Political freedom also shows a strong association, particularly with regard to minority inclusion. The report argues that conventional cross-country regressions may underestimate democracy’s benefits due to short-term disruptions during democratic transitions.
The study also examines whether democracy substitutes for or complements legal institutions. It concludes that democratization brings larger economic gains in countries with initially weaker rule-of-law institutions: on average, a 12.3 percent increase in GDP per capita over 20 years compared to 5.3 percent in stronger legal systems.
Regionally, while many established democracies – including Canada and the United States – have seen declines in scores, some countries made progress. The report mentions that Poland, Guatemala, Vietnam, South Africa, and Jordan registered improvements. In contrast, Georgia, Burkina Faso, and Mozambique recorded declines in both freedom and prosperity metrics.
The Atlantic Council’s findings align with broader research on governance and development. The World Bank’s governance indicators, for instance, emphasize that accountable institutions underpin sustainable development. The IMF notes that “good governance”, including transparency, rule of law, and anti‑corruption, is essential for economic stability and growth.
Recent reports by V-Dem, the Economist Intelligence Unit, and Freedom House also underscored ongoing democratic retreat worldwide. These analyses highlight trends such as the global rise of autocracies, increasing authoritarian suppression, and the continuation of a nearly two-decade-long decline in political and civil freedoms.