I've now re-read Bryan Caplan's piece Hong Kong: Statist at Heart (and thanks to Conrad for the pointer). There are several pieces that require a response.

Hong Kong has had the freest economy in the world since 1970, the earliest year covered by the Economic Freedom of the World data set. Indeed, it's higher now under the Communists than it was in 80's! And it's hard to deny that Hong Kong has been an economic miracle since World War II. So even though Hong Kong was not a democracy before the Communist takeover, it's very tempting to believe that the people of Hong Kong would have voted to retain (if not initially adopt) the free-market policies they had.

"There is a misconception that Hong Kong has the freest economy in the world -- it is called free because there are no laws to control the behaviour of businesses," said Lin Ping, head of economics at Hong Kong's Lingnan University. "Some companies are very powerful; there is no level playing field. New companies cannot come in and compete fairly, I do not see that as a free economy."

"Hong Kong is an open economy, a free trade city, and it has no capital control," Tsang [Shu-ki, economics professor at HK Baptist] said. "But that doesn't mean this economy does not have what we are worried about, and that is anti-competitive behaviour."

"Hong Kong is probably the only advanced economy in the world that does not have a comprehensive competition law," said Lin.

"To have strong market power isn't what we are against but to abuse market power is wrong," said barrister and legislator Ronny Tong, a vocal advocate of fair competition.

"There are more cross-sector enterprises that conduct activities that are against fair competition principles. The government needs to do something about it," Tong added.

Next comes the assertion Hong Kongers would have voted to establish and retain the free market policies that got the city to this point. Not only is that impossible to prove, it is meaningless. You could argue that Hong Kongers may have been prepared to pay the price in foregone economic success in return for the right to vote. Worse, the statement supposes that Hong Kong's voters would have been blessed with incredible foresight - that they would have known these policies would be the "best" ones. It also supposes that Hong Kongers are happy with today's economy. While there is no denying many Hong Kongers are well off today, there are many more who are not. Companies and cartels wield far more power over consumers and taxpayers than in other advanced market economies. The average Hong Konger still lives in a flat that is 600 square feet. Measures of welfare are broader than per capita GDP. Quality and standards of living matter more.

Hong Kongers generally agreed with the laissez-faire policy of HK's Government, back in 1990, although I wonder how many of the survey's subjects understood what laissez-faire meant. But when presented with more specific interventionist policies, Hong Kongers generally backed them as well. That could imply a disconnect between what Hong Kongers think is laissez-faire and how it is implemented. It could also reflect a general willingness to agree with whatever the survey asked. If the specific policies suggested were asked in isolation, without explaining their implementation and potential costs, it is not surprising that people agreed on the need for a minimum wage, price controls, taxing the rick and protecting local industry. These kind of motherhood statements are often well supported...in isolation. You'll likely get similar support if the survey is done in Communist China or in capitalist New York.

I came across a study of Folk Economics that explains "the intuitive economics of untrained persons. It is concerned with distribution, and does not allow for or understand incentives." This perfectly explains the reactions in the survey (and in many other debates besides). It boils down to general ignorance of economics. That's not a crime and it is something that democracy could well cure. How? Because when politicians become accountable to voters rather than special interests, they need to educate the electorate on the value of their policies.

Unfortunately this blows the rest of Caplan's point out of the water:

To be blunt, it looks like the lack of democracy under British rule was a key component of Hong Kong's ascent. The policies worked wonders, but they never became democratically self-sustaining. In politics, people often resist policy change just because "things have always been this way," even if the results were never very good. But free-market policies apparently labor under a greater political handicap. Even if "we've always left these things to the free market," even if leaving things to the free market has worked in the past, it just isn't enough to win over public opinion.

There may be merit to the idea that these policies are not democratically self-sustaining. That supposes that Hong Kongers should leave the running of their city and economy to the experts - an illiberal notion. If the policies have proven good enough for Hong Kongers in the past then they should be confident enough to hold their own should they be subjected to a public vote. Surely that's the point of voting - a competition of ideas.

Caplan concludes:

Countless market-oriented intellectuals idolize Hong Kong but I've never heard of, much less met, a Hong Kong libertarian. Google confirms my impression, returning no relevant hits for "Hong Kong libertarian." I'd like to think, then, that Hong Kong's problem was a shortage of libertarian intellectuals to transform freedom by default into freedom on principle. But sadly, I suspect that wouldn't have been enough either.

Even if Hong Kong's free markets aren't so free, Mr Caplan needn't despair. Libertarianism is alive and well in Hong Kong, although it may not go under that name.

Besides, Hong Kongers don't get a choice.