Our Economics Pupils Make Scotland's Top 5 in Young Economist of the Year 2026

We are proud to share that their blog has been ranked in the top five in Scotland, out of more than 50 entries! Run by Discover Economics and the Royal Economic Society, the competition challenges young people to think critically about contemporary economic issues and develop their own perspectives on the problems facing the UK and the world. Read our pupils’ blog below to discover their take on what it truly means for a country to be wealthy...

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Is a country truly wealthy if it has a high GDP but its citizens are unhappy?

Rich Country, Unhappy People: What Does It Really Mean to Be Wealthy? 

By Daniel, Supreme and William (S6)

A country's wealth is often judged by the size of its economy. Governments celebrate rising GDP (a luxury not always afforded to recent UK governments) while economists frequently use GDP per capita as the benchmark for comparing living standards between nations. But this raises an important question: does producing more goods and services necessarily mean that people live better lives? This report argues that although a high GDP is an essential foundation of national wealth, it is not sufficient as a measure of national welfare.

Strictly, in the language of economics, a country with a high GDP is wealthy: that is what the term describes. But "wealthy" can mean two very different things. It can mean a large output, or the lived condition of a population that is secure, healthy and content.

 The most-used measure of material welfare is GDP per capita — real national output divided by the population. It is a far better guide to living standards than total GDP, because it adjusts for population size: India has a much larger economy than Switzerland, but the average Swiss citizen is vastly richer. But "material welfare" is doing a lot of quiet work in that definition. It captures what we can buy. It does not capture our health, the cleanliness of our air, the strength of our relationships, the security of our jobs, or whether we feel our lives have meaning. This is exactly the gap identified by Robert F. Kennedy in a 1968 speech at the University of Kansas (Kennedy, 1968), who argued that GNP captures economic activity but not what makes life worthwhile. He was making a measurement point that economists now broadly accept: an accounting framework built around production is simply not a measure of human flourishing.

It would be too easy, and wrong, to dismiss GDP. The case for it is genuinely strong. First, GDP strongly correlates with material living standards, especially at low income levels where extra output directly improves access to essentials such as food, water, and healthcare. Second, GDP provides policy options, enabling welfare systems such as healthcare, education, and pensions that directly improve wellbeing. Third, the data do not show that money is irrelevant. Finland has ranked as the world's happiest country in multiple consecutive editions of the World Happiness Report rankings, with Denmark, Iceland and Sweden consistently close behind (World Happiness Report, 2024). Crucially, they pair high GDP per capita with low inequality, high social trust and strong welfare systems.

And yet the question assumes a country where GDP is high but people are unhappy — and such countries clearly exist. The most powerful example is China. Between roughly 1990 and 2010, China's economy underwent one of the fastest expansions in human history, with hundreds of millions lifted out of poverty. Research suggests that life satisfaction in China did not rise in line with its rapid economic growth between 1990 and 2010. Worse, life satisfaction appears to have fallen most sharply among the poorest (Easterlin et al., 2012). This is the Easterlin Paradox: beyond a certain income level, GDP growth may not increase happiness due to hedonic adaptation and relative income effects. The richest large economies illustrate the same point. The United States and the United Kingdom have very high GDP per capita, yet rank outside the very top of happiness rankings (World Happiness Report, 2025), and the US in particular has struggled with stagnating wellbeing, deep inequality and "deaths of despair" even as output has climbed. Meanwhile Costa Rica has recently ranked among the highest in the world for happiness, despite a GDP per capita far below Western Europe's — buoyed by strong family and community ties, a healthy environment and high social trust (World Happiness Report, 2025).

So what makes citizens unhappy even in rich countries? The recurring factors are those poorly captured by GDP: inequality, which corrodes trust and fuels social comparison; insecurity, when growth comes with precarious work and weak safety nets; environmental degradation, where pollution and loss of green space are counted as economic output rather than costs; and the erosion of community and meaning that can accompany rapid, materialistic development. GDP, by design, treats the costs of divorce, imprisonment, and environmental damage as additions to national income. A measure that cannot distinguish between building a hospital and cleaning up a disaster cannot fully capture how well a country is doing.

If GDP is necessary but not sufficient, what should sit alongside it? Bhutan famously adopted Gross National Happiness in place of GDP as its guiding development indicator, building policy around wellbeing, culture and the environment rather than output alone. The Human Development Index combines income with health and education. The World Happiness Report and the OECD Better Life Index go further, folding in social support, freedom, trust and life satisfaction. The broader "Beyond GDP" movement argues that what we measure shapes what we pursue, and that an obsession with output crowds out the things that actually make life worthwhile. None of these proposes scrapping GDP. GDP should be one instrument on the dashboard, not the entire dashboard.

So, is a country truly wealthy if it has a high GDP but its citizens are unhappy? The honest answer is: it depends on what you mean by wealthy, and the two meanings pull apart. In the narrow, technical sense, yes — a high-GDP country is wealthy. And that wealth is not worthless. But wealth, properly understood, is a means, not an end. The whole point of producing more is to live better — and a country with a soaring GDP and a miserable population has simply lost sight of that purpose. It is like a person with a full bank account and an empty life: rich on paper, impoverished where it actually counts. GDP can tell us how big an economy is. It cannot tell us whether a country is actually well. A nation is truly wealthy not when it produces the most, but when that production is turned into lives worth living.

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Daniel, Supreme and William have been invited to an awards ceremony in Edinburgh this month, hosted by the Scottish Government, where they will receive their certificates from the Chief Economist, present their ideas on the theme of their blog and have the opportunity to meet professional economists. Congratulations team, an amazing achievement! Keep up the great work!