The effects of sub-components of economic freedom on load capacity factor: Empirical analysis for MENA countries

This study investigates the effects of economic freedom sub-components on load capacity factor (LCF) in 12 MENA countries for 2017-2022. The 12 sub-components of the economic freedom index were used as independent variables, and the load capacity factor was used as the dependent variable. In the study, four-panel data models were created using the subcomponents of the economic freedom index, and a two-stage System-GMM was used. According to the study, while property rights reduce the load capacity factor, Judicial Effectiveness increases it. The effect of Government Integrity on the load capacity factor is statistically insignificant. While Government spending negatively affects the load capacity factor, Tax Burden and Fiscal Health are statistically insignificant. Business freedom affects the load capacity factor positively, but monetary freedom affects it negatively. Labour freedom is statistically insignificant. On the other hand, trade freedom and investment freedom have a positive impact on the load capacity factor, while financial freedom has a negative effect.