Governments should prioritize well-being over economic growth

Although economic growth dominates public discourse, the evidence indicates that it does not actually improve people’s feelings of well-being in the long run explainFrancesco Sarracino and Kelsey J. O'Connor from STATEC Research in their article "Governments should prioritize well-being over economic growth" published today in the journal Nature Human Behavior. The authors explain this apparent contradiction, stating people care deeply about purchasing power and employment, which are related to but not guaranteed by growth. Indeed, money can even buy hope against uncertainty. The challenge is that growth is often unequal, its positive effects are undermined by social comparisons, and growth frequently comes with environmental and social costs like pollution and distrust.

To improve peoples' lives, policymakers should focus directly on well-being. This amounts to selecting policies that have a positive and direct impact on well-being. Compared to others, this approach emphasizes desirable and relatable outcomes close to people’s daily experiences. For this reason, it has the potential to generate greater public support.

The well-being-first paradigm is also compatible with social and environmental targets. The authors provide several concrete examples, gathering evidence from various policy interventions worldwide. For instance, urban greening programs notably reduced crime and improved mental and physical health.

Multiple approaches exist to use well-being in policymaking. To facilitate further application, the Organization for Economic Cooperation and Development (OECD) recently created the Knowledge Exchange Platform to share best practices, such as the United Kingdom’s treasury guidance on how to do cost benefit analysis using well-being.

Promoting well-being can also kick-start a self-reinforcing virtuous cycle, in which greater well-being leads to social and environmentally sustainable societies.