placestats

Sound money (Fraser) vs. Tax revenue

Holds up after adjusting for income

Across 132 countries, Sound money (Fraser) and Tax revenue rise and fall together at r = +0.36 (on a scale from −1 to +1, where 0 means no link). It holds up almost unchanged when only countries with similar income (GDP per person) are compared (r = +0.24, q = 0.018, allowing for the many pairs tested).

Comparing countries across the middle half of sound money (Fraser), 6.7 to 9.22 points, tax revenue is 3.29% of GDP higher at the top of that range than the bottom. Comparing only countries with similar national income, the gap is 2.42% of GDP.

Link before adjusting (r)+0.356p = 2.8e-5 · 132 countries
After adjusting for national income+0.243p = 0.005 · likely range [+0.08, +0.40]
p, allowing for regions0.001standard error 0.040 · 7 regions
Check for luck (q)0.018across 17,292 pairs

How to read these.r runs from −1 (one goes up as the other goes down) to +1 (they rise together), and 0 means no link. Adjusting for national income means comparing countries with the same GDP per person, so differences in wealth can’t explain the link. Income is used in percentage terms, since an extra $1,000 means more to a poor country than to a rich one. p is how likely a link this strong would be if there were really none. Below 0.05 means it is unlikely to be chance. Very small values are written in short form: 1.1e-32 means a decimal point followed by 31 zeros and then 11, so very close to zero. The likely range is where the true figure probably lies, and a range that crosses zero means the link could easily be chance. Countries in the same region tend to resemble each other, so the third figure allows for that, which gives a fairer p. The standard error is the typical size of the error in r. Finally, testing this many pairs means some will look strong by luck alone. A q below 0.05 means this link is unlikely to be one of those.

Sound money (Fraser) · rating (0-10)link with income +0.54 · moderate
Tax revenue · % of GDPlink with income +0.33 · moderate

“Link with income” is how closely each measure tracks GDP per person across countries, from −1 to +1.

Every country as a dot

Sound money (Fraser) · rating (0-10) →Tax revenue · % of GDP →1.269.670.648%35.4%Angola: 3.53 rating (0-10), 7.59% of GDPAlbania: 9.26 rating (0-10), 18% of GDPUnited Arab Emirates: 8.48 rating (0-10), 0.648% of GDPArgentina: 1.26 rating (0-10), 10.4% of GDPArmenia: 9.23 rating (0-10), 22.4% of GDPAustralia: 9.18 rating (0-10), 23.6% of GDPAustria: 8.92 rating (0-10), 25.8% of GDPAzerbaijan: 7.31 rating (0-10), 17.3% of GDPBurundi: 6.35 rating (0-10), 12.7% of GDPBelgium: 9.32 rating (0-10), 23% of GDPBurkina Faso: 6.52 rating (0-10), 18.7% of GDPBangladesh: 6.22 rating (0-10), 7.64% of GDPBulgaria: 8.94 rating (0-10), 20.7% of GDPBahrain: 9.2 rating (0-10), 2.82% of GDPBahamas, The: 6.61 rating (0-10), 17.3% of GDPBosnia and Herzegovina: 6.65 rating (0-10), 20.2% of GDPBelarus: 8.18 rating (0-10), 13% of GDPBelize: 6.36 rating (0-10), 21.3% of GDPBrazil: 8.6 rating (0-10), 15.4% of GDPBarbados: 8.03 rating (0-10), 23.4% of GDPBhutan: 6.69 rating (0-10), 12.3% of GDPBotswana: 8.98 rating (0-10), 22.4% of GDPCentral African Republic: 6.57 rating (0-10), 8.21% of GDPCanada: 9.03 rating (0-10), 13.7% of GDPSwitzerland: 9.67 rating (0-10), 9.45% of GDPChile: 9.19 rating (0-10), 18.3% of GDPChina: 8.33 rating (0-10), 7.02% of GDPCote d'Ivoire: 6.75 rating (0-10), 13% of GDPCameroon: 6.47 rating (0-10), 11.3% of GDPCongo, Dem. Rep.: 5.95 rating (0-10), 10.7% of GDPCongo, Rep.: 5.02 rating (0-10), 6.51% of GDPColombia: 7.01 rating (0-10), 15.2% of GDPCabo Verde: 9.53 rating (0-10), 18.4% of GDPCosta Rica: 9.47 rating (0-10), 13.5% of GDPCyprus: 9.48 rating (0-10), 23.9% of GDPCzechia: 9.2 rating (0-10), 18.6% of GDPGermany: 9.38 rating (0-10), 10.9% of GDPDenmark: 9.32 rating (0-10), 33.4% of GDPDominican Republic: 9.01 rating (0-10), 14.7% of GDPEcuador: 7.89 rating (0-10), 13.1% of GDPEgypt, Arab Rep.: 5.33 rating (0-10), 12.5% of GDPSpain: 9.36 rating (0-10), 14.9% of GDPEstonia: 8.61 rating (0-10), 22.7% of GDPEthiopia: 5.12 rating (0-10), 3.4% of GDPFinland: 9.62 rating (0-10), 25.3% of GDPFiji: 6.54 rating (0-10), 23.9% of GDPFrance: 9.41 rating (0-10), 22.8% of GDPGabon: 5.91 rating (0-10), 9.49% of GDPUnited Kingdom: 9.21 rating (0-10), 26.9% of GDPGeorgia: 9.09 rating (0-10), 24.3% of GDPGhana: 2.92 rating (0-10), 12.4% of GDPGuinea-Bissau: 6.55 rating (0-10), 8.3% of GDPGreece: 9.09 rating (0-10), 27.4% of GDPGuatemala: 9.22 rating (0-10), 11.6% of GDPHonduras: 8.83 rating (0-10), 15.1% of GDPCroatia: 8.72 rating (0-10), 21.2% of GDPHungary: 8.74 rating (0-10), 22.7% of GDPIndia: 7.77 rating (0-10), 6.93% of GDPIreland: 9.3 rating (0-10), 17.9% of GDPIraq: 5.83 rating (0-10), 1.34% of GDPIceland: 8.89 rating (0-10), 23.2% of GDPIsrael: 9.1 rating (0-10), 23.2% of GDPItaly: 9.54 rating (0-10), 25.6% of GDPJamaica: 8.46 rating (0-10), 23.7% of GDPJordan: 9.6 rating (0-10), 15.5% of GDPKazakhstan: 7.87 rating (0-10), 11.9% of GDPKenya: 9.2 rating (0-10), 14.1% of GDPKyrgyz Republic: 7.61 rating (0-10), 19.6% of GDPCambodia: 9.31 rating (0-10), 12.2% of GDPKorea, Rep.: 9.4 rating (0-10), 13.3% of GDPLao PDR: 4.51 rating (0-10), 12.1% of GDPLebanon: 3.95 rating (0-10), 11.1% of GDPSri Lanka: 4.92 rating (0-10), 9.88% of GDPLesotho: 7.55 rating (0-10), 35.4% of GDPLithuania: 8.74 rating (0-10), 21.9% of GDPLuxembourg: 9.49 rating (0-10), 28.6% of GDPLatvia: 9.06 rating (0-10), 17.6% of GDPMorocco: 6.81 rating (0-10), 22.7% of GDPMoldova: 7.14 rating (0-10), 18.8% of GDPMadagascar: 7.41 rating (0-10), 10.9% of GDPMexico: 7.66 rating (0-10), 14.8% of GDPNorth Macedonia: 7.9 rating (0-10), 18.8% of GDPMali: 6.89 rating (0-10), 12% of GDPMalta: 9.45 rating (0-10), 24.1% of GDPMyanmar: 3.91 rating (0-10), 6.02% of GDPMongolia: 8.1 rating (0-10), 16.9% of GDPMozambique: 7.76 rating (0-10), 21.8% of GDPMauritius: 9.07 rating (0-10), 20.5% of GDPMalawi: 3.78 rating (0-10), 15.6% of GDPMalaysia: 9.41 rating (0-10), 12.4% of GDPNamibia: 6.58 rating (0-10), 33.9% of GDPNicaragua: 8.79 rating (0-10), 20.1% of GDPNetherlands: 9.31 rating (0-10), 25.3% of GDPNorway: 7.83 rating (0-10), 24.5% of GDPNepal: 7.58 rating (0-10), 13.9% of GDPNew Zealand: 9.38 rating (0-10), 29.5% of GDPPanama: 9.37 rating (0-10), 7.18% of GDPPeru: 9.07 rating (0-10), 15.9% of GDPPhilippines: 9.35 rating (0-10), 14.4% of GDPPapua New Guinea: 6.58 rating (0-10), 15.5% of GDPPoland: 7.71 rating (0-10), 17.4% of GDPPortugal: 9.3 rating (0-10), 22.3% of GDPParaguay: 8.97 rating (0-10), 11.3% of GDPRomania: 8.66 rating (0-10), 16.2% of GDPRussian Federation: 5.15 rating (0-10), 10.9% of GDPRwanda: 8.57 rating (0-10), 12.7% of GDPSaudi Arabia: 8.33 rating (0-10), 8.09% of GDPSudan: 1.26 rating (0-10), 7.39% of GDPSenegal: 6.74 rating (0-10), 19.5% of GDPSingapore: 8.76 rating (0-10), 13.6% of GDPEl Salvador: 9.5 rating (0-10), 21.8% of GDPSomalia, Fed. Rep.: 9.34 rating (0-10), 2.24% of GDPSerbia: 7.35 rating (0-10), 23.9% of GDPSlovak Republic: 9.22 rating (0-10), 19.1% of GDPSlovenia: 9.25 rating (0-10), 21% of GDPSweden: 9.34 rating (0-10), 27.2% of GDPEswatini: 7.86 rating (0-10), 24.3% of GDPTogo: 6.76 rating (0-10), 13.9% of GDPThailand: 9.5 rating (0-10), 15.2% of GDPTajikistan: 8.64 rating (0-10), 10.7% of GDPTimor-Leste: 6.64 rating (0-10), 21.6% of GDPTrinidad and Tobago: 8.52 rating (0-10), 16.8% of GDPTunisia: 7.42 rating (0-10), 20.1% of GDPTurkiye: 2.69 rating (0-10), 17.6% of GDPTanzania: 8.02 rating (0-10), 12.3% of GDPUganda: 9.3 rating (0-10), 12.6% of GDPUkraine: 6.04 rating (0-10), 21% of GDPUruguay: 8.63 rating (0-10), 17.9% of GDPUnited States: 9.19 rating (0-10), 10.8% of GDPSouth Africa: 7.85 rating (0-10), 25.9% of GDPZambia: 6.7 rating (0-10), 18.8% of GDPZimbabwe: 1.94 rating (0-10), 7.21% of GDPAREARGBHRDNKLSOLUXNAMNZLSDNSOMTURZWE

best-fit line line after adjusting

Four ways to measure the link

MethodrpCountries
Standard (Pearson), not adjusted+0.3562.8e-5132
By rank (Spearman), not adjusted+0.3406.7e-5132
Standard (Pearson), adjusted for national income+0.2430.005132
By rank (Spearman), adjusted for national income+0.1860.034132

The rank version uses only each country’s place in line, from lowest to highest, so a few extreme countries count for less. The adjusted and unadjusted versions use the same 132 countries: those that report both measures and GDP per person. So the gap between them comes from the adjustment, not from a change in which countries are counted. Drop in the size of r after adjusting: +0.113 (a minus sign means it grew).

How solid is it?

Leaving out one country at a time, r ranges from +0.224 (without ARG) to +0.276 (without SOM). The bar above shows that range on a scale from −1 to +1, with the solid line at the full result. The single country that moves r most: SOM (+0.032).

Within each region

Countries are not separate, unrelated cases, and neighbors share a lot. A link that holds inside each region is far more believable than one that shows up only when comparing regions.

nr
East Asia & Pacific15+0.16
Europe & Central Asia45+0.20
Latin America & Caribbean21+0.08
Sub-Saharan Africa33+0.32

By income third

If the link shows up only in the richest third of countries, it is a feature of rich countries, not a general pattern.

nr
Poorest third44+0.28
Middle third44+0.28
Richest third44+0.20

By largest religious group

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
Christians89+0.27
Muslims25-0.06

By last European coloniser

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
France14+0.35
Never a European colony14+0.14
Spain17+0.10
United Kingdom40+0.24

By official ideology

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
Nationalist19+0.46
No strong official ideology91+0.19

By party system

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
A few parties banned18+0.43
No parties banned102+0.18

Without outliers (countries far outside the middle half of countries on either measure, by more than one and a half times the width of that middle half): r = +0.201 after dropping 5 countries.

Two series, one country

Both measures over the years for one country you pick. The two charts are stacked so they share only the years along the bottom.

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Over time, within countries

Everything above compares countries with each other at one moment. This section compares each country only with itself over 35years. So a link here can’t come from anything about a country that stays the same, such as its history, geography, institutions or culture.

Within countries over time, there is no link that is clearly more than chance (r = +0.010, comparing each country only with itself over the years, and each year only with the same year elsewhere). Whatever the cross-country picture shows, countries whose sound money (Fraser) moved did not tend to see their tax revenue move with it.

Across countries (adjusted)+0.243for comparison
Within countries+0.024each country vs itself
…and vs the same year elsewhere+0.010q = 0.807 · 136 countries
Year-on-year changes+0.036q = 0.332

2,882 country-years (one country in one year), 136 countries, 1990–2024, about 21 years each on average. Share of the variation that happens within countries over time: 38% for Sound money (Fraser), 25% for Tax revenue. The margins of error allow for each country appearing many times, and for each year’s value being close to the year before.

Year-to-year changes are a cautious test, not a final answer. Looking only at changes from one year to the next removes each country’s own trends. But it also makes measurement mistakes louder, which pulls the results toward zero. A near-zero result here is weak evidence of no link, not proof.

With one measure years behind the other

0.20−0.2-100+10years Tax revenue trails Sound money (Fraser) →lag -10: r = 0.179 (n = 2,375)lag -9: r = 0.184 (n = 2,428)lag -8: r = 0.182 (n = 2,477)lag -7: r = 0.168 (n = 2,523)lag -6: r = 0.155 (n = 2,585)lag -5: r = 0.140 (n = 2,703)lag -4: r = 0.131 (n = 2,734)lag -3: r = 0.108 (n = 2,775)lag -2: r = 0.082 (n = 2,798)lag -1: r = 0.049 (n = 2,811)lag +0: r = 0.010 (n = 2,882)lag +1: r = 0.001 (n = 2,793)lag +2: r = -0.026 (n = 2,702)lag +3: r = -0.044 (n = 2,610)lag +4: r = -0.053 (n = 2,509)lag +5: r = -0.035 (n = 2,403)lag +6: r = -0.022 (n = 2,302)lag +7: r = -0.021 (n = 2,206)lag +8: r = -0.011 (n = 2,107)lag +9: r = 0.001 (n = 2,003)lag +10: r = 0.013 (n = 1,889)

Same year (lag 0): +0.010. A peak away from zero does not show which comes first. These series change slowly — this year’s value is close to last year’s. That makes the curve smooth and nearly symmetric, whatever produced the data. Even a sharp peak at one lag (a gap of some years) would not prove that one measure changes the other.

The largest value on this curve (+0.18 at lag -9) is higher than the same-year one by 0.17. That gap is not a finding. It is the largest of 21 closely related estimates, and picking the biggest of many tests always makes it look bigger. That is exactly why nothing on this site is ranked or chosen by lag.

The data


rating (0-10)
% of GDP		Years
Switzerland CHE9.679.45%2024
Finland FIN9.6225.3%2024
Jordan JOR9.615.5%2024, 2023
Italy ITA9.5425.6%2024
Cabo Verde CPV9.5318.4%2024, 2020
Thailand THA9.515.2%2024
El Salvador SLV9.521.8%2024
Luxembourg LUX9.4928.6%2024
Cyprus CYP9.4823.9%2024
Costa Rica CRI9.4713.5%2024
Malta MLT9.4524.1%2024
France FRA9.4122.8%2024
Malaysia MYS9.4112.4%2024
Korea, Rep. KOR9.413.3%2024
New Zealand NZL9.3829.5%2024

Gwartney, J., Lawson, R., Murphy, R. and others, Economic Freedom of the World: 2026 Annual Report, Fraser Institute. Data from the EFW panel dataset (efotw-2026-master-index-data-for-researchers-iso.xlsx).
World Bank, World Development Indicators

Sources

Sound money (Fraser)

Economic freedom, area 3, sound money (Fraser Institute)

Fraser Institute · No licence stated; used with citation · updated annual

Whether money keeps its value: low and steady inflation, money supply growing in step with the economy, and freedom to hold foreign currency. A country with high inflation scores low. It is built from inflation figures, so it is close to the inflation measure by construction.

Tax revenue

Tax revenue (% of GDP)

World Bank · CC BY 4.0 · updated quarterly

How this was computed

Data used: most recent value in 2010-2025; values come from 2012–2024. To adjust for income, each measure is first predicted from GDP per person (in percentage terms, on a log scale) with a straight-line fit. Only what is left over is then compared. This is called a partial correlation. The line is drawn the standard way (ordinary least squares), which picks the line that comes closest to all the countries at once. The error margins allow for countries in the same region resembling each other, using 7 World Bank regions. The q-value corrects for testing all 17,292 pairs at once, using the Benjamini–Hochberg method. Underlying data last updated V-Dem v16; V-Party v2. How the country data works · explore Sound money (Fraser) and Tax revenue

This page shows that two measures go together. It does not show that Sound money (Fraser) changes Tax revenue, or the reverse. These figures also describe countries, not individual people. See the ecological fallacy.

More links with Sound money (Fraser) or Tax revenue