Libertarian Paradise: Liechtenstein

By Jackson Parker | LIECHTENSTEIN

The Principality of Liechtenstein situated on the eastern border of Switzerland goes unnoticed by many despite its record achievements. The small country, only spanning a total of 62 square miles, has proven themselves to the world that they can run an efficient country for its citizens. Liechtenstein holds one of the highest ratings of GDP per capita in the world, first if not adjusting for purchasing power parity. It has an astounding human development index of .912, above numbers such as the UK’s, Japan’s and South Korea’s. The country’s population of around 37,000 have had a minuscule unemployment rating of less than 3%.

But with this extreme economic prosperity, something surely must be the cause.

The cause is the libertarian tendencies of the country’s policy.

With 88% of the legislature belonging to fiscally right-wing parties, the people of Liechtenstein have one of the freest economies in the world. Liechtenstein holds some of the lowest tax rates in the world which a basic personal income tax of 1.2% and corporate profits are only taxed 12.5%. This economic freedom has allowed the small country to have more registered companies than citizens that make up for its lack of natural resources with opportunity in an extremely strong financial sector.

The sitting Prince of Liechtenstein, Hans-Adam II also strongly believes in the ideas of liberty stated in his book, The State in the Third Millennium.

“I would like to set out in this book the reasons why the traditional state as a monopoly enterprise not only is an inefficient enterprise with a poor price-performance ratio, but even more importantly, becomes more of a danger for humanity the longer it lasts.”
-HSH Sovereign Prince Hans-Adam II of Liechtenstein, The State in the Third Millennium, Introduction (Page 2)

The nation-state of Lichtenstein does an excellent job of eliminating government overreach by employing federalism to its 11 autonomous municipalities. This shrinking of the federal government allows freedom to breathe inside of the tightly woven communities atop the Alps.

“The State should treat its citizens like an enterprise treats its customers. For this to work, the State also needs competition. We therefore support the right of self-determination at the municipal level, in order to end the monopoly of the State over its territory.”
-HSH Sovereign Prince Hans-Adam II of Liechtenstein

With the massive successes in economic and human development, Liechtenstein presents a favorable case towards how smaller government benefits everyone involved. With legislation to eliminate overstepping government regulations, taxes, and control, perhaps the whole world can take a card out of the Alpine microstate’s playbook to further the freedom of their citizens and to promote economic growth inside of their own borders.

2 thoughts on “Libertarian Paradise: Liechtenstein”

  1. Liechtenstein has a pretty similar economy to Switzerland. (Which has a rather large government footprint on the economy.) There has to be a third variable and I’d say it is not being in the E.U. and therefor not a candidate for the destruction of Protectionist policies and the extraction of labor and resources from larger E.U. countries.

  2. Liechtenstein is hardly “small government” with minimal government overreach. It may have relatively low marginal tax rates, but it social policies are right-wing authoritarian. No thanks…

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