The effect of economic freedom, economic complexity and population growth rate on per capita income

https://doi.org/10.35912/jomabs.v2i3.2957
Published: May 27, 2025

Abstract:

Purpose: This study aims to identify the effect of economic freedom, economic complexity, and population growth on the per capita income of each country (high-income countries, upper-middle-income countries, lower-middle-income countries, and low-income countries).

Method: The research method used is panel data regression with a cross-sectional data set of 102 countries. The dependent variable used is per capita income for each high-income country, upper-middle-income country, lower-middle-income country, and low-income country.

Results: The analysis using panel data regression across 102 countries revealed varying impacts across income groups. In high-income countries, only trade freedom had a significant positive effect on per capita income. For upper-middle-income countries, none of the variables showed a significant influence. In lower-middle-income countries, monetary freedom positively affected per capita income, while economic complexity had a negative impact. In low-income countries, only business freedom significantly increased per capita income. Simultaneously, all independent variables collectively influenced per capita income across all income groups, with adjusted R² values ranging from 28.2% to 59.6%.

Keywords:
1. Economic Freedom
2. Economic Complexity
3. Population
4. Per Capita Income
Authors:
1 . Crisnina Handayani
Universitas Lampung, Indonesia
2 . Marselina Marselina
Universitas Lampung, Indonesia
3 . Arvina Ratih
Universitas Lampung, Indonesia
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How to Cite
Handayani, C., Marselina, M., & Ratih, A. (2025). The effect of economic freedom, economic complexity and population growth rate on per capita income. Journal of Multidisciplinary Academic Business Studies, 2(3), 307–327. https://doi.org/10.35912/jomabs.v2i3.2957
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Vol. 2 No. 3 (2025): May
Articles
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  2. Barro, R. J., & Sala-i-Martin, X. (1992). Convergence. Journal of political Economy, 100(2), 223-251.
  3. Chowdhury, M. (2004). Convergence of per capita GDP across SAARC countries.
  4. Dumairy. (1986). Matematika terapan untuk bisnis dan ekonomi: BPFE.
  5. Dwiyanti, N. M. C., Luh Putu Agustini Karta, N., Cintya, N. P., & Bendesa, I. N. G. P. (2023). Strategi Pemasaran Museum Gunung Api Batur sebagai Daya Tarik Wisata Edukasi di Kabupaten Bangli. Jurnal Studi Perhotelan dan Pariwisata, 2(1), 37-45. doi:https://doi.org/10.35912/jspp.v2i1.2565
  6. Firdaus, M. (2011). Aplikasi ekonometrika untuk data panel dan time series: Bogor: IPB Press.
  7. Gujarati, D. N., & Porter, D. C. (2012). Basic econometrics: New York The McGraw-Hill, Inc.
  8. Gwartney, J., & Lawson, R. (2005). Economic freedom of the world 2004: Annual Report. ICADE. Revista de la Facultad de Derecho(66).
  9. Hidalgo, C. A., & Hausmann, R. (2009). The building blocks of economic complexity. Proceedings of the National Academy of Sciences, 106(26), 10570-10575. doi:https://doi.org/10.1073/pnas.0900943106
  10. Hussain, M. E., & Haque, M. (2016). Impact of economic freedom on the growth rate: A panel data analysis. Economies, 4(2), 5. doi:https://doi.org/10.3390/economies4020005
  11. Mankiw, N. G. (2007). Makro Ekonomi, Edisi ke-6. Jakarta: Erlangga.
  12. Manurung, A. S. P., & Putro, U. S. (2024). Decision Analysis of ANH Gas Field Using Value Focused Thinking and AHP. Jurnal Bisnis dan Pemasaran Digital, 3(2), 155-173. doi:https://doi.org/10.35912/jbpd.v3i2.4516
  13. Miller, T., Holmes, K. R., & Feulner, E. J. (2012). Highlights of the 2012 Index of Economic Freedom: Promoting Economic Opportunity and Prosperity. Heritage Foundation and The Wall Street Journal.[2012]. URL: https://thf_media. s3. amazonaws. com/index/pdf/2012/Index2012-Highlights. pdf.
  14. Putra, A. J. L. (2022). Pengaruh Stabilitas Politik, Korupsi, Indeks Kebebasan Ekonomi, dan Pertumbuhan Penduduk Terhadap Pertumbuhan Ekonomi di Asean-5 Tahun 2014-2019. Universitas Siliwangi.
  15. Sutama, I. K. G., Dewi, N. D. U., & Rahayu, L. R. (2024). Community Based Tourism sebagai Salah Satu Konsep Pengembangan Pariwisata. Jurnal Studi Perhotelan dan Pariwisata, 2(1), 47-55. doi:https://doi.org/10.35912/jspp.v2i1.2042
  16. Thalib, M. A., Kuntuamas, M. J. A., Umar, T. P. A., & Sulastri, R. D. (2023). Potret Praktik Akuntansi oleh Pengusaha Kos-kosan berbasis Nilai Budaya Lokal. Jurnal Bisnis dan Pemasaran Digital, 2(2), 71-83. doi:https://doi.org/10.35912/jbpd.v2i2.2573
  17. Thalo, N. (2007). Kebebasan Ekonomi Indonesia: Tinjauan Perkembangan Terkini. Retrieved from
  18. Todaro, M. P., & Smith, S. C. (2009). Economic development: Pearson education.