Global Policy Forum

Economic Growth and the Quality of Life

In recent years many commentators, including Nobel laureate Amartya Sen, have questioned the equivalence of economic growth with growth in well-being and the quality of people's lives. They point out that wealth creation does not necessarily lead to broader improvements in the quality of life. In numerous cases, nations have similar GDP levels or average income levels, yet differ substantially in levels of national health and education. At the same time, some poorer nations fare better than some richer nations in terms of life expectancy, infant mortality, and other indicators of well-being.

GPF Perspectives

In Search of Buen Vivir (January 11, 2011)

GPF Europe's Jens Martens argues that the MDGs, although a good start for countries, are incomplete and lack an emphasis on holistic growth. Rather than focusing narrowly on material well-being, human development should be viewed in broader context. He is encouraged by new development paradigms which go further than merely increasing income growth and providing basic social services. (IPS)

Thinking Ahead - Development Models and Indicators of Well-Being Beyond the MDGs (November, 2010)

Jens Martens, Director of Global Policy Forum Europe, argues that if the Millennium Development Goals are to be reached by 2015, development as concept must be fundamentally revised. Development is still primarily measured by economic indicators while factors like income distribution, environmental consequences and gender equity are given little attention. Martens promotes a new approach in which poverty and wealth must not be viewed as separate, but rather as but mutually interdependent. (Global Policy Forum)


2013 | 2012 |2011 | 2010 | 2008 | 2007 | 2006 | Archive


Rethinking the Role of Consumption (July 24, 2013)

Economic growth remains the focus of both policies and societies worldwide. In the meantime, social inequality rises and the ecological destruction of our planet continues to accelerate. We know that things have to change, but struggle to imagine a good life beyond the consumption driven lifestyles we have established for ourselves in. In this new publication Is Different Really Enough? Thoughts on a New Role for Consumption, experts from different parts of the world address the question of consumer responsibility in the necessary transformation process towards more sustainable societies and set out to look for new roles for consumption. (Friedrich-Ebert-Stiftung)


America's Deficit Attention Disorder (August 13, 2012)

The political debate in the United States and Europe has focused on public financial deficits, but largely ignored the social and environmental deficits. In a system in which money has become an end rather than a means, the benefits of GDP growth have gone almost exclusively to the 1 percent, at the expense of social and natural capital on which true prosperity depends. Runaway public deficits are but one symptom of a fundamental system failure—so long as money frames the debate, the conflict between the rights of nature, human rights, property rights, and corporate rights will continue to threaten the human future. (Yes!Magazine)


Rising GDP Will Never Add Up To a Just Society (August 17, 2011)

The director of the Jimmy Reid Foundation, a Scottish think-tank, argues that increased wealth does not benefit everybody, and instead, governments must look at policies to increase equality in order to create a more progressive, just society. GDP growth is not the solution to society’s problems because it may benefit only a few, not increase the job rate, or can be unsustainable. Instead, “it’s all about how you grow.” Over the last 30 years, as Scotland became wealthier, there was actually in increase in inequality, higher levels of crime and lower levels of happiness. States should realize that GDP growth may not foster growth in all sectors, and reassess their priorities. (Scotsman)

Poverty Reduction is Not Development (January 10, 2011)

Debate amongst policy makers is shifting towards national industrial policies. Many economists are writing off the market-only Washington Consensus as an enormous failure. Policy makers are now presenting "new" strategies for poorer nations to grow. Analysts and practitioners are looking at earlier development paradigms and adjusting them to include new ideas like environmental sustainability. (The Guardian)


The Illusion of Poverty Reduction (October 11, 2010)

Muhammed Yunus, the Bangladeshi economist and 2006 Nobel Peace Prize co-recipient, said that the next generation will have to go to a poverty museum to learn about what poverty really is. However, his idea of microfinance didn't put an end to poverty. Microfinance is deeply rooted in neoliberal ideology and many people have ended up worse off than before taking microloans, because there is a limited market demand for local enterprises. People will have a better chance finding a way out of poverty through progressive taxation and wealth distribution than through microfinance. The flaws of capitalism are unlikely to be corrected with more capitalism. (Share the World's Resources)

Politicizing Economic Policy (September 5, 2010)

If a sustainable and fair economy is ever going to become global reality, economic policy has to include the citizens' voice. A continued centralized, top-down ruling in which non-state actors and stakeholders have more to say than the average citizen, will lead to nothing else but greater injustice, both global and regional. Large corporations and financial bodies "need to be brought into the realm of public accountability". A just and lasting economic policy is the one that improves the life quality for a country's population - not the one that increases the GDP to any cost. (Policy Innovations)

The Rise and Fall of the GDP (May 13, 2010)

Policy makers and academics are questioning GDP, the standard national indicator of economic health, as an insufficient gauge for human progress. Seemingly lost in lengthy GDP data streams are indicators which would better determine items like human health and societal well-being. Governments around the world are now changing direction, moving toward a new set of measures that will ultimately replace GDP. (The New York Times)


Alternative Poverty Estimates Say Progress Is Too Slow to Achieve the Millennium Development Goals by 2015 (September 22, 2008)

The Basic Capabilities Index (BCI), released by Social Watch, shows that the vast majority of 176 countries experienced slow progress or even regression in basic social indicators. The BCI provides a general overview of the health status and basic educational performance of each country. Sub-Saharan Africa scored particularly low on the index, and Social Watch says that at this rate the region will not reach an acceptable BCI score before the 23rd century. (Social Watch

China and India: Heartlands of Global Protests (August 7, 2008)

China and India have secured their reputation as global economic powers. However, internal unrest in both countries is mounting because the benefits of the economic growth affect only a small percentage of the populations. In China, this economic discrepancy has resulted in protests against police and other government officials. Meanwhile, in India, politically motivated bombings affect Mumbai and Bangalore. The author argues that world leaders and economists should rethink the dominant economic model because, while it promotes high economic growth rates, it does not take into account rising inequalities between the rich and the poor. (openDemocracy)

Global Slowdown: The LCDs' Sword of Damocles (July 17, 2008)

This World Economy and Development in Brief article states that increased exports and foreign investment have led to strong economic growth in some poorer countries. But, the growth has only benefited a small section of these countries' populations. The 2008 UNCTAD Least Developed Countries Report says that countries should increase public spending through well-targeted programs in areas of primary education and create jobs for their growing populations. (World Economy and Development in Brief)

GDP: The Measure and Mismeasure of the Economy (June 30, 2008)

This Canadian Broadcasting Corporation article criticizes world leaders and economists who use Gross Domestic Product (GDP) as an indicator of quality of life. GDP measures overall output and strength of a country's economy. But, the author says "GDP is a measure of quantity, not quality," as it fails to reflect the income gaps between the rich and the poor. He proposes alternate measures like the UN Human Development Index and the Genuine Progress Indicator that use health, environmental impact and standard of living as indicators of the quality of life. (Canadian Broadcasting Corporation)


American Sickness: Diagnosis and Cure (October 16, 2007)

This article focuses on the huge inequalities in the United States. The economic differences are particularly well reflected in statistics on US citizens' health. In the Harlem district of New York, life expectancy of male infants matches that of Belize and Tanzania and the average life expectancy is lower than in Bangladesh. Poverty and job insecurity leave a great number of US citizens without any or sufficient insurance and access to health care in general is often limited. The authors point to success in other industrialized nations and call for higher spending on education and increased levels of taxation to create a more equal society. (openDemocracy)

When Development and Tradition Clash (May 11, 2007)

Violent clashes between Indian farmers and corporations backed by the Indian government reveal "deep underlying problems with…the Western model of modernization," reports the International Herald Tribune. Although politicians argue that the growing private industrial sector will create jobs and promote development, many poor farmers are being forced off their land by government officials, who then sell it for profit to foreign investors. This article calls on India to adequately compensate its citizens for appropriated land and to grant them "a say in the process of development." (International Herald Tribune)

Fighting For Air: Frontline of War on Global Warming (March 26, 2007)

This Guardian article argues that Linfen, China, "the most polluted city on earth," symbolizes "the worst side-effects of…breakneck economic growth." Although China and India are two of the world's four biggest emitters of greenhouse gases, both maintain that they must use more energy to stimulate development. Despite the contaminated rivers, melting glaciers, rising temperatures, and increased respiratory diseases in both countries, the article reports that neither is likely to submit to binding commitments to reduce emissions unless the US – the world's "principal polluter" – first agrees to do the same. (Guardian)


Chain-Gang Economics (October 30, 2006)

In this Foreign Policy in Focus piece, Walden Bello argues that the economic relations between China and the US chain the global economy together in a "crisis of overproduction." Restrictive Chinese rules on trade and investment force transnational corporations (TNCs) operating in China to locate the majority of their production processes in the country, making the TNCs major "agents of overinvestment." At the same time, Chinese authorities continue exploiting the country's cheap labor by keeping wages down instead of expanding people's purchasing power. Thus impeding domestic consumption, China has chosen breakneck growth feeding the spending appetite of US consumers over domestic and global stability, argues Bello. (Foreign Policy in Focus)

Social Watch Report 2006 - Impossible Architecture (2006)

In this annual Social Watch publication, NGOs from all over the world report from their individual countries on progress and government action on social development. In addition to 42 national reports, the publication contains thematic reports mainly looking at development financing, including debt relief, international aid, domestic resources and global taxes. Rather than providing any "particularly original or revolutionary" ideas, the report offers "common sense" responses arguing for example that "taxes should be paid by all, and that those who have more and earn more should pay more." (Social Watch)

Development Requires Local Empowerment (September 27, 2006)

The 2006 "Least Developed Countries Report" found that although the world's poorest countries have enjoyed the highest growth rates in two decades, human well-being in these mainly African countries has not improved. The author of this Foreign Policy In Focus piece argues that the lack of rural communities' participation in governing their natural resources largely accounts for that imbalance. He warns that initiatives such as the UN Millennium Development Project, the US Millennium Challenge and Oxfam International's "Trade not Aid" campaign will not promote development unless they focus on creating accountable countryside democratic institutions. (Foreign Policy In Focus)

Realizing Decent Work in Asia (August-September 2006)

This International Labor Organization (ILO) report highlights how unemployment in Asia has increased despite robust growth in investment, output and productivity. Moreover, since employers continuously fall short of providing "decent work" conditions, employment fails to reduce poverty. One billion "working poor" in Asia live on less than US$2 a day, 330 million of these on less than US$1. The particularly high unemployment rates among the young and a working age population set to grow rapidly over the next decade spurs further concern. On the other hand, the ILO finds Asia has the potential to take the lead on decent job creation. (International Labor Organization)

The Hard Truth Behind Asia's Boom (August 22, 2006)

With 42 percent still living on less than US$2 a day in China and almost half of all children in India undernourished, economic growth has failed to improve the lives of hundreds of millions of impoverished people in these countries. However, as this International Herald Tribune article suggests, economic growth enables governments to tackle the "roots of poverty" by providing health care and education. The author argues that the public must hold policy makers responsible to provide these services as well as address factors that impede the poor's use of them. (International Herald Tribune)

Trade on Human Terms: Overview (June 29, 2006)

This United Nations Development Program (UNDP) report summary stresses the importance of the relationship between economic growth and human development. Based on a study of the Asia-Pacific region, UNDP found that free trade has failed to benefit key sectors of society, thus decreasing regional stability. UNDP proposes an eight-point agenda to channel policies dealing with competitiveness, trade, agriculture, jobless growth, taxes, and exchange rates in order to promote a better quality of life for all along with economic expansion. (United Nations Development Program)

Least Developed Countries Report 2006 (May 17, 2006)

UNCTAD finds that higher rates of economic growth in many least developed countries (LDCs) have not translated into improved human well-being. The comprehensive 2006 Least Developed Countries Report suggests that LDCs must increase their very low labor productivity to achieve sustained growth and poverty reduction. As 2000-2010 will be the first decade in the LDCs where the economically active population outside agriculture will grow faster than that within, the LDCs must develop competitive businesses in manufacturing and services, says the report. It identifies challenges that LDCs will face in this effort, among them improving physical infrastructure. UNCTAD finds that donors must reallocate aid to address these challenges. (UNCTAD)

The Hijacking of the Development Debate (Summer 2006)

This World Policy Journal article criticizes Jeffrey Sachs and Thomas Freidman's approach to end poverty, which advocates effective aid and open markets to help poorer nations climb the "development ladder." Donor countries often channel aid in a way that increases income inequalities and, open markets tend to benefit big corporations. To redress this, the alter-globalization movement comprised of farmers, students and environmentalists, promotes development through redistribution of political power and wealth. Contrary to Sachs and Freidman who use monetary values to assess development, the movement uses indicators like democracy, sustainability, food security, and human rights. (World Policy Journal)

Invest Globally, Stagnate Locally (April 2, 2006)

The continuous increase of corporate profits in the US and Europe fails to translate into prosperity for domestic economies and wage earners. Transnational Corporations (TNCs) maintain low wages by constantly threatening to leave the country if wage negotiations do not meet their corporate interests. The article predicts a new rise of "economic nationalism" among rich countries as a reaction to the reluctance of TNCs to pay decent wages to their workers. (New York Times)

Aid Inflows, Debt Relief Yet to Translate into Reduced Poverty (March 20, 2006)

Uganda, as many other sub-Saharan African countries, has achieved increased economic growth accompanied by moderate inflation rates. However, this "macroeconomic stability" has failed to improve the living conditions of the country's poor. At a meeting organized by the International Monetary Fund (IMF), Ugandan government officials pointed out that, although the country receives more aid flows "on paper" they have little impact "on the ground." (New Vision)

World Economy Giving Less to Poorest in Spite of Global Poverty Campaign Says New Research (January 23, 2006)

According to a publication of the New Economics Foundation, the world's poorest benefit very little from economic growth. Moreover, "our obsession with growth" fails to provide long-term, environmentally sustainable solutions to people's well being. While economic growth can contribute to better living conditions, the report encourages alternative approaches to global economic challenges. (New Economics Foundation)

Growing Dissent (January 23, 2006)

Many economists see growth as the ultimate answer to all problems, including poverty. Nevertheless, the poor's share in its benefits has decreased constantly in recent decades and the environmental costs of growth have steadily grown. This article calls for a new global economic system with a global income distribution arrangement to assure poverty reduction and environmental sustainability. (Guardian)


FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.