Human rights contribute positively to economic growth
Freedom rights as well as equal access to education and health contribute to economic growth on a global level. These are the main conclusions drawn from two studies made by the three researchers, Hans-Otto Sano, Sigrid Alexandra Koob & Stinne Skriver Jørgensen at the Danish Institute for Human Rights.
In 2017 they concluded that freedom and participation rights affect economic growth positively in the long term. Especially, the rights to freedom of assembly and association and electoral self-determination demonstrate a significant positive effect on economic growth.
In a recent working paper, they build on the work from 2017 to examine how the right to education and the right to health influence economic growth.
The new study examines the impact of equal access to basic education and healthcare on economic growth. This includes analysis of how the effect of equal access to basic education and healthcare differ across levels of equality and regions and their respective levels of equality.
The studies are based on dynamic panel data estimation methods on respectively 167 and 157 countries between the years 1981 to 2011 and the years 1960 to 2012.
The positive effects from human rights on economic growth are indicatively channelled through institutional and economic factors such as government effectiveness, investments, trade as well as human development and income equality.
Inequality is hampering economic growth
Many politicians and economists have argued that inequality spurs economic growth. The new analysis shows this not to be true. It supports what International Monetary (IMF) among others have stated in the recent years: Countries with high levels of inequality suffer lower growth than nations that distribute incomes more evenly.
Both studies reveal a positive effect of human rights on economic growth, and no evidence of a negative effect is found. Therefore no trade-off between human rights and economic growth prevails.