Wealth or Well-being?

Picture courtesy of Adib Wahab
Picture courtesy of Adib Wahab

Having watched some interesting TED Talks on well-being, I’ve got to thinking. So what do I do after thinking? Post to my blog of course.


 

One TED Talk in particular tackled measuring WELL-BEING. The speaker was critical of GDP as a measure of progress. In his view it measured the wrong factor – i.e. the efficiency of production – when determining how well a country was doing.

When several thousand people around the world were asked what constituted well-being, they overwhelmingly returned four factors. These were:

  • Happiness
  • Love
  • Health
  • Wealth

All very predictable responses I hear you saying. What’s interesting is that Wealth scored significantly lower than the other three factors.

His conclusion (demonstrated through statistics) was that when comparing the well-being of a nation against its efficiency of production, the Western countries along with several middle eastern countries were performing quite badly. The high level of production and consumption is proving highly inefficient at creating well-being. Don’t ask me how the statisticians quantified well-being, the speaker didn’t go into the details of this.

The key to success, according to the speaker was high well-being coupled with lower production. I think he was an environmentalist. As proof, he cited Costa Rica which scored much higher than the USA in well-being despite having significantly less GDP than the USA. Its citizens even have a higher life expectancy than the USA despite spending nowhere near as much on health care. It sounds like he’s stating the obvious – i.e. money can’t buy you happiness. But the accepted system of ‘national accounting’ used worldwide seems to be blind to this concept.

Another poll conducted by statisticians tried to unpick what factors contributed to happiness. The people polled returned five factors:

  • Being connected to family and a community
  • Being active and doing stuff;
  • Making time to take notice of the world around you
  • Continuously learning new things and not necessarily in the academic sense
  • Being able to give and thereby helping others.

These things seem deceptively easy to achieve without needing access to a huge amount of resources.

I’m not an economist, so can’t make the counter argument for GDP, but a pragmatic voice in the back of my mind says: “Focus on Wealth creation and this will give people the resources to improve their Health. Once they have Wealth and Health, better to leave people to find Love and Happiness on their own without meddling.”

GDP growth has crept into our collective consciousness. Even a lay person like myself gets that increased productivity leads to higher income which leads to higher tax revenue which can be used to maintain service delivery levels for a growing population. So good governments focus on an education system that produces skilled & efficient employees. They support a health system that keeps us healthy and Working. They build infrastructure that makes it more efficient for companies to do business. They cheer companies that shrink their costs while growing those like-for-like sales each year. They regulate so that unproductive practices are discouraged. The list goes on.

But is there a place for well-being in this kind of approach? Should (or indeed can) government spend less of its time, effort and money on the economy and more on those factors that can give us a ‘good life’? Or would this be social engineering and meddling in the lives of people who already know how best to live a happy life?

Living in the West, I can tell you that Marketing and Advertising does a very good job of trying to convince you how to live a happy life. Its key ingredient is Consumption – “Purchase this thing and you will be happy.” That doesn’t quite agree with the five factors described above.

As it is, I’m a little confused by it all and would love to hear your views on the matter – be they informed or otherwise.

What should be the priority – Well-being or Wealth Creation? And if well-being, what would be the implications for developing countries such as our own Republic?

@CitizenLagu