From Economic Growth to Sustainable Wellbeing
From Economic Growth to Sustainable Wellbeing

Author(s): Dimitar Sabev
Subject(s): Economy, Business Economy / Management
Published by: Институт за икономически изследвания при Българска академия на науките
Summary/Abstract: This article argues that growth is not always a path to greater happiness: based on data from 134 countries grouped into 6 regions, the analysis identified three major patterns in the relationship between economic growth and subjective wellbeing. In the Global North, there is a significant negative association – that is, higher growth impedes the population’s wellbeing. For the emerging economies in Asia and Latin America, the link is positive: higher economic growth promotes happiness. Finally, for a broad group of countries in Africa and the Middle East, as well as in the Eurasia region, there is no clear statistical association between growth and happiness, assumedly because of their statist and resource-based economic structure. The general conclusion confirms the existence of the Easterlin Paradox on an international level, which might be explained by two main factors: the higher marginal social and environmental costs of growth beyond a certain threshold, and the need for institutions to provide equitable distribution of the surplus output. The main policy implication of this finding is that “more growth” is an improper development prescription for both the richest and the poorest nations.

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