From a TED talk by Michael Green:
Gross Domestic Product has become the yardstick by which we measure a country’s success. But, says Michael Green, GDP isn’t the best way to measure a good society. His alternative? The Social Progress Index, which measures things like basic human needs and opportunity.
Analysts, reporters and big thinkers love to talk about Gross Domestic Product. Put simply, GDP, which tallies the value of all the goods and services produced by a country each year, has become the yardstick by which we measure a country’s success. But there’s a big, elephant-like problem with that: GDP only accounts for a country’s economic performance, not the happiness or well-being of its citizens. With GDP, if your richest 100 people get richer, your GDP rises … but most of your citizens are just as badly off as they were before.
That’s one of the reasons the team that I lead at the Social Progress Imperative launched the Social Progress Index in 2014. The Social Progress Index determines what it means to be a good society according to three dimensions: Basic Human Needs (food, water, shelter, safety); Foundations of Wellbeing (basic education, information, health and a sustainable environment); and Opportunity (do people have rights, freedom of choice, freedom from discrimination, and access to higher education?)
GDP is very important as it allows a country to do a lot of the other stuff, but it is not the only indicator that matters.
Chart 2: A telling comparison: New Zealand vs. Norway
Countries can experience similar levels of social progress at vastly different levels of GDP per capita. New Zealand achieves a Social Progress score of 87.08, which is almost as high as Norway’s 88.36, but at a GDP per capita that is half that of Norway: $32,808 versus $62,448.
The chart is:
If you look at New Zealand’s scorecard, it does a bit better than Norway on opportunity — on personal rights in particular — and a little worse on personal safety and ecosystem sustainability.
What exactly is driving this? You’d have to ask the New Zealanders. Indeed, that’s one of the things we hope to do next: identify role models for other countries and unpack how exactly they’re doing the things they do well.
I think one of the things we do well is focus hard of equality of opportunity. This is very very different from equality of outcome, but makes a big difference.
This year, we worked out a Social Progress score for the world. We’ve taken the population-weighted average of all the countries and summed it up together. This gave a level of social progress that is 61 out of 100, which means that the average human being lives at a level of social progress somewhere between Cuba and Kazakhstan.
Somewhat depressing but was worse in the past.