How are we doing?
Not as well as you might think, according to the Happy Planet Index (HPI) which released it’s third annual ranking of nearly all the world’s countries last week.
The HPI is an alternative to GDP as a measure of national well-being. A country’s HPI score is calculated by multiplying together its life expectancy and reported subjective happiness survey scores and dividing the result by the country’s ecological footprint per person. The aim is to measure how much life and of what quality a country achieves proportionally to the ecological resources that it consumes.
The results are surprising. Costa Rica tops the table. The US comes in at number 114 out of 143 country’s measured. It’s outstanding wealth does not make Americans outstanding happy and requires an exorbitant amount of the earth’s resources to sustain. Israel is ranked around 70th, just above Britain.
The report’s lead author, Saamah Abdallah of the New Economics Foundation explains the rationale behind it.
“The HPI suggests that the path we have been following is, without exception, unable to deliver all three goals: high life satisfaction, high life expectancy and ‘one-planet living’. Instead we need a new development model that delivers good lives that don’t cost the Earth for all.”
The HPI is one of a number of indices that highlight the limitations of GDP as a measurement of welfare and aim to propose an alternative. Higher GDP is only correlated with increased happiness up to around $10,000 per person. After that point, there’s little connection between income and happiness. Furthermore, consumption of alcohol, drugs and medical care count as GDP gains. So do wars, strip mining, deforestation and commuting to work, although these things do not enhance overall well-being.
These indices are being developed by ecologcial economists, who argue that economics must be embedded with an understanding of the ecological context in which economies function. The Heschel Center together with the Van Leer Institute have such set up a research group in Ecological Economics (which I’m glad to be a part of) to bring this important body of thinking into the Israeli conversation. Hopefully one of the products will be a more accurate measure than GDP of how we’re really doing as a society. Stay tuned!
I'm Julian, Co-Founder of 
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I’m not surprised by these findings at all. Much of the advancement in American culture has led many of us astray in thinking that happiness comes from money and possessions. In regard to salary increasing happiness, I’d say it’s the other way around. Many people become dependent on the full amount of their paycheck, and as salary increases, job related stress and overtime usually does as well. Personally, I’d much rather have a modest car and house in exchange for more freedom.
I’ve been to Costa Rica and I’m going back later this year and I agree it is one of the most beautiful places on the planet.
I remember eating the best fruits and vegetables there because they were not picked green and shipped thousands of kilometers.
These types of comparative reports really drive home the fact that money in your pocket (or bank account) is not always equivalent to the happiness in your heart.
Costa Rica had some happy and content people and they didn’t have much to show for in terms of wealth!
This is a great post and thanks for the discussion on this topic!
114?! That’s pretty low for the good ‘ol USA
Jeff at economixt is in the middle of writing his thesis on happiness economics and he’s got some great data on what Happiness means to some of his preliminary US survey respondents.
He made a pretty cool wordle out of it, definitely worth checking out:
http://www.economixt.com/2009/07/happiness-synonyms