Giving Compass' Take:
- Carol Graham and Sergio Pinto discuss the disconnect between development and well-being: in countries with swift GDP growth, happiness is in swift decline.
- How can funders better understand this troubling relationship? Can development be better orchestrated to increase, or at least maintain, happiness?
- Learn about inclusive growth and happiness.
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What we know depends on what we measure. Traditional income-based metrics, such as GDP and poverty headcounts, tell a story of unprecedented economic development, as seen by improvements in longevity, health, and literacy. Yet, well-being metrics, which are based on large-scale surveys of individuals around the world and assess their daily moods, satisfaction with life, and meaning and purpose in life, among other things, provide a very different picture of what is happening to people within and across countries—stories that economic numbers often do not tell. Deep poverty and frustration persist in the most fragile countries, and income inequality and unhappiness are increasing in some of the richest ones. Remarkably, some of the most worrisome trends are in countries with rapid economic growth and falling poverty.
The world’s most recent success story in rapid growth and poverty reduction is India, with extreme poverty falling from 38 percent (2004) to 21 percent (2011). Still, life satisfaction dropped significantly—10 percent or a full point on a 0-10 scale—from 2006-2017. That is roughly equivalent to the unprecedented drop in life satisfaction in the U.S. during the first six months of the financial crisis. Optimism about the future, which typically remains steady even when life satisfaction drops, also fell at the same rate.
Another stark marker is suicide. By 2016, India had 18 percent of the world’s population but over a quarter of all global suicides, an increase of 40 percent from 1990 (these numbers may be low due to underreporting). Indian women account for 36 percent of the world’s total suicides for females and Indian men account for 24 percent of the male total.
This story of ill-being juxtaposed against the positive story told by standard economic indicators is not unique to India. Indeed, these trends mirror what happened in China a decade earlier. In the 1990s, China experienced perhaps the most rapid growth and poverty reduction in modern history. GDP per capita and household consumption increased fourfold between 1990 and 2005, and life expectancy increased to 75.3 years from 67 years in 1980. Nevertheless, in that period, life satisfaction fell dramatically and reported depression and suicides increased, the latter reaching one of the highest rates in the world in the 1990s.
Read the full article about development and well-being by Carol Graham and Sergio Pinto at Brookings.