Is Wellbeing the New GDP?
If GDP was the creation of the West, then wellness indicators can be the work of the non-West.
By Xische Editorial, July 23, 2019
You can’t avoid coverage of the global markets these days. Trade war concerns loom large and debates circulate about a possible economic recession. But what if we are thinking about economics all wrong? What if we are missing the point? Gross domestic product (GDP) dominates the way politicians, many economists, and the media think about the economy. But there is much more to a healthy economy than GDP. What about the progress of people and their health? We need new metrics to measure success, growth, and progress that matters in the marketplace.
Economists love growth. The economic goal is always growth and GDP measures growth. That explains why this somewhat archaic measurement is so popular. But what counts as growth anyway? National debt and money spent on natural disasters contribute to growth figures. Charity donations don’t. Societal health and wellness are also noticeably absent from the equation. This imbalance is ripe for a re-think.
GDP is a relatively new economic instrument that originated in the United Kingdom during World War II. The British government needed a quick method to calculate economic activity to evaluate what amount of production could go into the war effort. Many of the economists involved in the creation of GDP were adamant that the figure was not intended to be a measure of human welfare or even progress.
As the Cold War progressed, GDP was weaponized by the United States and Russia to see who was a more powerful country. What began as a specific measure of war readiness transformed into an instrument of conflict itself. This sordid history highlights how GDP can serve some specific purposes but as a measure of human wellness and welfare, it is certainly not the best number to go by.
Without happy and healthy citizens, GDP growth is not sustainable in the long term. That is why there is a new push to make the wellness of citizens and residents the centrepiece of new economic forecasting. Scandinavian countries have long been leaders in citizen wellbeing, but now the UAE is joining the charge. Through government initiatives like the National Program for Happiness and Wellbeing and various health-focused campaigns, the UAE is ensuring its residents enjoy all the benefits of wellness. In the knowledge-based economy of the future, wellness will be just as important as the consumer price index.
Investing in the health of citizens and residents is the best way to ensure that an economy thrives. GDP growth can only go on to a certain point as resources are ultimately finite, not to mention society burnout when GDP figures overshadow other needs in the market. The question is how can wellness be situated into a fresh economic discussion for the future. The answer, ironically, lies in the shifting fortunes of global GDP growth.
By 2030, emerging market economies will account for 70% of global GDP, dramatically reordering our global economic landscape. Since 1990, more than a billion people have lifted themselves out of extreme poverty, gained access to healthcare and education for their families, and capitalized on opportunities for gainful employment. Yet for the ‘next billion,’ access to opportunity remains a critical challenge.
Countries like the UAE are at the centre of this dramatic shift. They are the new beacons for the emerging market economies. As they push forward with initiatives that place emphasis on wellness at home, they can have a knock on effect in other countries. Put simply, the UAE can lead by example to help craft the economic agenda of the future in emerging markets.
As the next billion come online, they can demand that wellness be factored into their economic future. They can push to have the health and wellness initiatives that shaped the UAE’s approach become a reality in their home markets. If classic GDP was the creation of the West, then wellness indicators can be the work of the non-West. The rules are being rewritten and the centres of power have shifted dramatically.