Freedom is worth more than a billion dollars

Canadians typically enjoy high living standards yet tend to suffer from weaker social support networks than countries such as Mexico where, despite having much lower standards of living on average, residents often live in very tight-knit communities. According to a new study conducted by a pair of researchers from McGill and the Universitat Autònoma de Barcelona, tight social circles in Mexico several important advantages.

“The aim of our study was to take a literature which is now firmly well-developed about the determinacy of happiness […] and think about what the implications were for the future,” Christopher Barrington-Leigh, associate member of McGill’s Department of Economics and associate professor in the McGill School of Environment and the Institute for Health and Social Policy, said.

The researchers used a statistical model which combined two sets of measures. The first set measured objective, material factors: Per capita gross domestic product (GDP) and life expectancy. The second set was based on social factors including corruption, freedom, charitableness, and social support. The researchers then observed the global changes in the well-being of individuals between 2005 and 2016, as self-reported by evaluations from the Gallup World Poll, a global poll created in 2005 which tracks quality of life statistics in more than 160 countries. Based on the changes to the measures over time, the study projected self-reported quality of life for the year 2050.

The researchers found that changes in ‘material’ variables produce modest improvements in global quality of life. These changes varied from an increase of zero to 10 per cent above present levels. Meanwhile, changes in the non-material factors showed up to a 30 per cent increase in quality of life. The greatest potential for such improvement was found in India, China, Eastern European countries, and sub-Saharan African countries. The most pessimistic scenario, on the other hand, showed a decline in non-material factors leading to a decline in quality of life of 35 per cent. The survey also showed that global improvements in material conditions were more significant when paired with enhanced average freedom and corruption scores and were negligible when accompanied by declining average social support scores.

This study suggests that the greatest benefits to well-being in the upcoming decades lie in the non-material realm, suggesting that states should focus their resources on explicitly social aims. This conclusion has interesting ramifications for public policy.

“Governments need to start thinking about cost-benefit analysis differently,” Barrington-Leigh said.

Certain countries have already started to weigh policy alternatives based on residents’ well-being.

“New Zealand has just started to implement cost-benefit analysis for its budgeting processes in terms of human well-being, so this, I would say, is the beginning of a revolution,” Barrington-Leigh said. “Wales has also done something similar by passing a piece of legislation which says that governments should be accountable to future well-being. In that sense, the implications for governmental policy are very radical, [and] they could really eventually change how things are happening in the world.”

Barrington-Leigh hopes that other countries will join New Zealand and Wales in considering non-material well-being in cost-benefit analyses. However, despite the many new insights provided by this study, its model is far from perfect.

“Implications for future research are to start being much more quantitative and predictive,” Barrington-Leigh said. “We painted two scenarios, but they were not predictive.”

Increased predictive power is crucial for shaping future governmental policy.

“Future research [should investigate] what policies […] we should be following in order to get one of those scenarios in 2050 versus another,” Barrington-Leigh said.

Utilizing the right policies will help to achieve the optimal scenario in 2050 in a world with increasing material standards and decreasing social well-being.

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