A budget for Growth, Happiness, Equality and Life Expectancy Please

April 4, 2011 at 3:52 pm 2 comments

By Peter Baeck

Two weeks ago George Osborne presented his ‘Budget for Growth’. A few articles, presentations and podcasts I’ve come across between then and now, have made me think about ‘growth’, and how we sometimes may look for the wrong things when trying to find out what we value in our society and how we want to grow this.

First, I listened to the Freakonomics podcast ‘The Health of Nations’ where Professor of Law and Ethics Martha Nussbaum was interviewed about her critique of the usage of Gross Domestic Product (GDP) as a measurement tool of how healthy countries are compared to each other. The problem, Nussbaum explained, is that GDP fails to capture a whole range of things that says a lot about a nation’s wealth, such as health, happiness equality and education. For example, South Africa under apartheid had a strong GDP, but was for many reasons not a very healthy society. As a response to this problem Nussbaum is, together with Amartya Sen, developing what the Human Development Index (HDI). HDI, in addition to GDP measures a series of other factors, such as life expectancy at birth, access to knowledge (mean years of schooling and expected years of schooling) and living standards (measured through GNI per capita). By not just focusing on GDP, but also on these additional factors, policy makers, according to Nussbaum, encouraged to move from a focus that evolves around economic growth, to policies that evolve around human well being. (I completely acknowledge that most policy makers will already address the human wellbeing factors, not least, because they are aware of the correlations between these and economic growth). Building on this Nussbaum countries who might not have the highest GDP in the world, come out on top because of their high levels of equality and high educational standards would come out on top. She describes how she, based on a HDI comparison would probably prefer to live in Finland, one of the HDI top scorers.

Moving on, I then watched this presentation by Geoff Mulgan on understanding the importance of happiness and the need to ‘Find a new way to measure happiness’  from TEDxObserver 2011

Mulgans point is that happiness is important for public policy, and that although we are now acknowledging the importance o it (its being measured by The Office of National Statistics), we are not necessarily measuring the right things. As Mulgan describes, we should be measuring mental health as well as physical health, levels of isolation as much as income etc. The reason why this is important is that, with the right understanding of happiness, we should be better able to support people to become happier, and therefore more resilient. By for example giving old people in care homes a plant to look after, (this has proven to increase health and longevity), or enabling people who are sick to spend more time with friends and family, which help them recover quicker, we can actively support the creation of a happier and healthier society. So, with a new perspective on understanding the health of our society and the importance of happiness, and measuring these the right way, I thought about Osborne and the Coalitions ‘Budget for Growth. Would it be possible to have a budget for growth, that didn’t focus on increasing GDP, but made people healthier, smarter and happier? With the big society the Coalition has already introduced a concept for society, that doesn’t necessarily require more financial contributions or growth, but (happy) volunteers and communities that help shape and deliver society and public services. I hope that growing the economy can be done side by side with growing the social economy, and that the coalition via the big society stays true to its commitment to the latter.


Entry filed under: Big society, Innovation Policy, Innovation Worldwide, Uncategorized.

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