Ten wins in ten countries: how Atlas Network's investment in economic freedom pay off
Matt Warner | President, Atlas Network
A street vendor in India sells his wares. Atlas Network's philanthropic strategy is squarely rooted in the key insight that economic problems are solved, not by outsiders, but by the individuals themselves who stand to benefit from expanded economic choices.
Getting ahead in one of the world’s least free countries is a challenge, but things got a little easier in Argentina this year when the Macri administration eliminated a 35 percent tariff on laptops and tablets. Before the tariff was removed, parents, school teachers, and small business entrepreneurs were forced to pay inflated prices for basic technology or go without. What’s more, the tariff had an outsized impact. Analysis by the Buenos Aires-based Libertad y Progreso, the nonprofit organization that successfully pushed for the tariff’s repeal, found that Argentinians were actually paying double what their neighbors in Chile paid for the same computer products.
“Protectionism tries to keep a few employed at the expense of everyone else,” explained Marcos Hilding Ohlsson, economist with Libertad y Progreso, “and we successfully demonstrated how harmful and unfair it is to make everyday people pay enormous prices for technology that they need to get ahead.”
This win for economic freedom in Argentina was no accident. Last year, Libertad y Progreso put together a research and advocacy plan aimed at eliminating the tariff, and they shared that plan with our team at Atlas Network when they applied for one of our grant programs, Liberating Enterprise to Advance Prosperity.
Because of our existing relationship with Libertad y Progreso, we knew their work well, and we admired what they had already accomplished since their founding in 2011. Thanks to the many training programs their leaders and staff had completed through our Atlas Leadership Academy program, we also knew their team was comprised of very talented and experienced professionals – each with a passion for economic freedom and achieving real change.
So, in 2016, Atlas Network invested in Libertad y Progreso’s project plan to eliminate the tariff on computer products. By summer 2017 it had won, and the tariff was gone.
That is why Atlas Network’s approach to serving the global network of organizations working to promote economic freedom works so well. Based on our interdisciplinary research covering social comparison theory and network behavior, we call this strategy Coach, Compete, Celebrate. It serves to accelerate learning and new levels of excellence across the globe as peers encourage, influence, and challenge each other to think big through training, grants, awards, and recognition.
Thinking big is important for the cause of economic freedom, and achieving real wins is what thinking big is all about. Argentina wasn’t the only place our partners thought big and won. Here are nine more countries where Atlas Network invested successfully in recent victories for economic freedom by our independent, local partners:
EasyBusiness successfully worked this year to put a true end to an archaic system of paper seals, like those of a notary, required for most businesses to gain government approvals. In practice, the seals served as a kind of bribery tour of government officials, an overwhelming drag on free enterprise.
Institute for Market Economics advocated the simplification of the business registration system resulting in a big drop in the number of procedures and days it takes to start a business.
Photo credit: Roberto Sorin / Shutterstock.com. A souvenir shop in Bulgaria.
Samriddhi Foundation pushed the ministry of industry to adopt an unprecedented 30-hour deadline for registering new businesses and a seven-day deadline for foreign-owned businesses. Previously, those wanting to start new businesses could have been held in bureaucratic limbo for several weeks to months.
Lithuanian Free Market Institute achieved reforms that made it easier and faster to get electricity, easier and faster to get construction permits, and much harder for the state to monopolize industries.
IDEAS advocated for and saw a huge jump in Costa Ricans’ access to credit thanks to reforms that got bad government policy out of the way.
Contribuyentes por Respeto’s analysis showed how businesses, particularly small businesses, were overburdened by oppressive tax compliance rules. Thanks to its efforts, the frequency of making tax payments has been cut by two-thirds.
Advocata Institute’s unique analysis and infographics – demonstrating the state of crisis of the country’s state-owned airline – became the go-to reference on the topic. Its work was the final push needed to get the government to put the struggling business up for sale.
A woman in Sri Lanka picking tea leaves.
INESS is a vocal champion of expanding economic choices and led the charge to reduce the burden of business licensing by introducing nominal fees – to the tune of only 1 Euro being required for registration of new businesses for entrepreneurs. Previous Slovak company law was based on rigid concepts over 50 years old, which did little to satisfy the needs of the country’s modern business environment.
When Centre for Civil Society pushed for the elimination of minimum capital requirements for new businesses, the Modi government listened. Now, entrepreneurs can decide for themselves if they’re well positioned to invest in their own futures.
Some of these wins may seem small, but we chose to invest in them because their impact is surprisingly large. New research shows many of these reforms not only improve the measurable scores for their respective countries on global indices like the Fraser Institute’s “Economic Freedom of the World” report and the World Bank’s “Doing Business” report, but they are also tied to poverty reduction as they expand economic choices for low-income people. In fact, every five percent increase in a country’s “Doing Business” score translates to a one-percentage point reduction in poverty, a new finding Atlas Network supported in the World Bank’s most recent report.
Atlas Network COO Matt Warner speaks during a special taping of Russ Roberts' popular EconTalk podcast at Liberty Forum and Freedom Dinner 2017 in New York City. Former deputy prime minister and finance minister of Bulgaria and creator of the World Bank's Doing Business series, Simeon Djankov, was also featured in the episode of EconTalk, speaking about the link between ease of doing business and poverty alleviation.
For example, in India, the minimum capital requirements for new businesses disproportionately burdened the poor and kept them from getting ahead. Growth and development experts like William Baumol and William Easterly point out that even incremental changes in a positive direction can make a big difference, particularly when it comes to expanding economic freedom, thus unleashing the ingenuity, tacit knowledge, and creative powers of more and more people.
Those are the wins, but what about the other investments? From this grant program to date we have invested $1,975,000 in reform projects in 29 countries, many of which are multi-year campaigns still on their way to bearing fruit, and some of which just launched this year. That means we plan to announce even more wins in the coming months as we scale up this grant program in 2018. Atlas Network’s strategic approach to investing in our partners’ work is paying large dividends in helping break down the barriers to prosperity and opportunity around the world.