Monday, November 11, 2013

Prosperity, Poverty, and Wellbeing

Prosperity, wellbeing, the good life--this elusive condition that we are all presumably striving for--is notoriously difficult to measure. We have long used income as a shorthand for wellbeing, but we are now realizing how limited that is as a proxy. An adequate income is certainly necessary, but alone is insufficient, for wellbeing. Part of the problem in measurement, as I argue in my forthcoming book on The Good Life, is that often precisely what is most valuable in life in least quantifiable, such as dignity, aspiration, and larger purposes.

Nonetheless, the urge to measure and rank countries produces lots of interesting data. The Legatum Institute's prosperity index uses 8 equally weighted sub-indices to calculate prosperity:
1. Economy
2. Entreprenuership and opportunity
3 Governance
4. Education
5. Health
6. Safety and Security
7. Personal freedom
8. Social capital
Nathan Gamester reports their 2013 findings in a recent issue of the Harvard Business Review, and there are several interesting results:
  • Norway, Switzerland, Canada, and Sweden come out on top
  • Since 2009, the United States has dropped from 12th to 24th
  • Germany has gone from 16th to 9th
  • Guatemala has drop from 82nd to 90th (out of 142).

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