Business | Investment
Affluence breeds discontent
People in countries with high growth rates tend to feel less satisfied with their lives.
- By Stephen Fidler, Financial Times
- Published: 23:30 November 21, 2008
Rapid economic growth makes people unhappy and many of Latin America's poorest are the most content with public services, a new study by the Inter-American Development Bank suggests.
Costa Ricans appear to be the most satisfied people in the region, followed closely by Panamanians, Mexicans and Venezuelans, according to the study.
People in Haiti, Dominican Republic and Nicaragua were among the least satisfied with their lives.
The study compares the United Nations Human Development Index, which attempts an objective measure of a country's income, health and education standards, with people's perception of those standards.
Guatemala and Venezuela have very favourable opinions compared with the objective standards in their countries.
But people in Argentina, Chile, Peru and Trinidad and Tobago appear to give insufficient recognition of their countries' achievements.
Although people in rich countries are generally happier than those in poor ones, people in countries with high growth rates tend to feel less satisfied with their lives than people in countries that have grown less, the research indicates.
"People have higher expectations and higher aspirations when growth is higher," said Eduardo Lora, IADB chief economist.
"But people who see that their peers are doing better than themselves are less satisfied. This effect becomes stronger when economies are growing faster."
This "unhappy growth paradox" threatens policies that promote efficiency and suggests, the study says, that "a strategy focused exclusively on growth has few possibilities of being politically sustainable".
The study concludes that a lack of aspirations weakens the demand for better education, health services and social protection.
The research shows Colombians are as happy with their education systems as Americans with theirs, and Uruguayans are on a par with the Japanese.
A similar evident paradox occurs in health.
The proportion of Guatemalans satisfied with their health services is very high, despite high mortality and poor sanitation afflicting many households, while Chileans are the Latin Americans who are least satisfied with their health services, although they have better health and live longer.
"Discontented but politically-active citizens are a better indication of social progress than a passive and tolerant society," the report concludes.
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