From Wealth to Well-Being
At a time when any sign of economic growth would be welcome it may seem odd to be concerned with the quality of that growth. That quality concern, the relative ability of different countries to convert wealth into well-being, is, however, the focus of a recent major report from Boston Consulting Group.
Countries with high rates of growth are not necessarily able to convert that growth into societal development whereas other less-GDP-impressive countries seem to have far better mechanisms for raising living standards.
The report, ‘BCG Sustainable Economic Development’ will be read with interest by governments and business alike. The usual knee-jerk reactions – analyzing league tables, spotting winners and losers and finding excuses – should be resisted. The real benefit in this massive benchmarking exercise comes from calm consideration of the methodologies and the rich depth of insights that the data reveals.
At the extremes it becomes clear that gaining economic growth in the short term ‘means little if living standards are undermined in the long term by poor health, underinvestment in education, a degraded environment, and a widening gap between rich and poor.’
The journey between the leading exemplar,Norway, and, 149 countries later, The Central African Republic, includes many surprises – and it is in examining these surprises that lessons may be learned.
It is some years now since ’The Spirit Level’ alerted us to the correlations between personal income inequalities and factors such as health, crime and education. That study initially attracted widespread disbelief and disapproval amongst establishment figures – a natural reaction to criticism and embarrassment that has since been modified by sober longer term reflections on the excesses that triggered the financial recession.
This new study, at a time when the evolution of the digital economy is forcing policy makers to be more responsive to citizen expectations, will add to their understanding. One must hope that in bearing a foreword contributed by Tony Blair, commentators are not tempted to dismiss the work out of hand but will listen carefully to his comments – particularly those on infrastructure development.