Tuesday, April 15, 2008

What do objective measures of freedom and flourishing tell us?

Attempts at objective measurement of human flourishing have been made for more than two centuries. In his recent book, Happiness: a history (Grove Press, 2006) Darrin McMahon describes a study by the Marquis de Chastellux published in 1772 (pp 214 -216). Chastellux contended that levels of population and the productivity of agriculture correlated directly with the happiness of people in different countries. He was able to use these indicators of the extent that basic physiological needs are satisfied, together with other indicators, such as the prevalence of slavery and war, to argue that people were in general happier in contemporary Europe and North America than in ancient Greece and Rome.

Given advances in collection of statistics it is now possible to compare indexes of freedom for a large number of countries with a variety of indicators of human flourishing. An index of economic freedom measures the extent to which policies and institutions of countries are supportive of economic freedom - which encompasses personal choice, voluntary exchange, freedom to compete and security of privately owned property (Economic Freedom of the World, Annual Reports).

The best modern day indicators of the extent to which basic physiological needs are satisfied are life expectancy and infant mortality. Average life expectancy at birth is 78 years in the quartile of countries with greatest economic freedom, using the Fraser Institutes index of economic freedom. That is 9 years longer than in the second quartile, 15 years longer than in the third quartile and 20 years longer than in the quartile of countries with the least economic freedom. Infant mortality rates are 12 times higher in countries with low economic freedom than in countries with high economic freedom (pp 22-24).

Access to the goods and services that money can buy is substantially greater in countries with high levels of economic freedom. GDP per capita is 8 times higher in the quartile of countries with greatest economic freedom than in the countries with least economic freedom. The economic condition of the poor is also better in countries with high economic freedom. The average incomes of the poorest 10 percent of the population in the countries with greatest economic freedom is more than double the overall average income level of the countries with least economic freedom. (Obtained by comparing data in Exhibit 1.14 (p 25) and Exhibit 1.6 (p22) Economic Freedom of the World, 2006 Annual Report).

The objective indicators discussed above are obviously relevant in considering the extent that basic physiological needs are being met. Arguably, income measures are also a relevant indicator of the extent to which some higher goals are being met. The question of whether rising incomes contribute to well-being in wealthy countries has become highly contentious, however, given the observation that subjective indicators, such as satisfaction with life as a whole, show only small increases in response to rising incomes in those countries. (I will write next about what subjective measures tell us about links between freedom and flourishing.)

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