The Role of Democracy and Economic Freedom in Economic Growth: Evidence from Developed and Developing Countries

Economic growth has been included in the literature as a historical concept that countries have endeavoured to achieve. To date, economic growth has been analysed using a variety of variables. In our study, the economic growth of seven developed countries and eleven developing countries, as well as military expenditures, democracy, economic freedom, foreign direct investment, and unemployment, were analysed using the Panel EGLS model. As a result of the analysis, it was found that economic freedom has a negative and insignificant effect, while democracy and unemployment have an adverse and significant impact. Additionally, military expenditures and Foreign Direct Investments (FDI) have a positive and significant impact on economic growth.