Resolution criteria:

This market will resolve based on the United States' score in the 2025 edition of the Economist Intelligence Unit's (EIU) Democracy Index. The score is typically published in the first quarter of the following year. The market will resolve to the exact numerical score assigned to the U.S. in the 2025 report. If the 2025 report is not published by June 30, 2026, the market will resolve as N/A.

Background:

The EIU's Democracy Index assesses the state of democracy worldwide by evaluating countries across five categories: electoral process and pluralism, functioning of government, political participation, political culture, and civil liberties. Each country receives a score on a scale from 0 to 10, with higher scores indicating stronger democratic practices.

In the 2024 report, the global democracy score reached an unprecedented low, with more than one-third of the world living under authoritarian regimes. The United States continued to be classified as a "flawed democracy." Discontent among populations has led to a rise in support for anti-mainstream and insurgent parties, which, if ineffective in governance, could exacerbate political polarization. Western Europe was the only region to see a slight improvement in its democracy index score. South Korea experienced a decline, falling into the "flawed democracy" category after political turmoil. However, some countries like the Czech Republic, Estonia, and Portugal have been recognized as "full democracies." (axios.com)

The United States' classification as a "flawed democracy" in recent years reflects ongoing challenges in areas such as political polarization, functioning of government, and public trust in institutions. Monitoring the 2025 Democracy Index score will provide insights into whether these trends have continued, improved, or worsened.