The Hayek-Friedman hypothesis could be interpreted in two ways. Either that it's impossible to be in quadrant D, or that quadrant D is not a stable equilibrium. In others words, that countries that find themselves in quadrant D will move away from it.
At various points in history, some countries have indeed occupied quadrant D. In 1980 there were 12: Bahamas, Barbados, Costa Rica, Denmark, France,
Greece, Iceland, Italy, Norway, Sweden, United Kingdom, and Venezuela.
If the Hayek-Friedman hypothesis were true, what should have happened by 2005?