Welfare states and wellbeing

Redesigning our society with a greater focus on well-being remains challenging. It requires holding on to the spirit of well-being, the general emphasis on it, while avoiding prescriptive lists that could result in simplistic boxticking. If designed well, well-being data will have a number of uses in the policy process. They will allow policymakers to provide better evidence of the likely impact of new policies across a range of dimensions; breakdown so-called policy silos by looking at important issues in a more holistic way; evaluate costs and benefits of a policy more accurately; reconsider existing policy priorities and introduce new ones; suggest new principles for detailed designs of policy; and identify inequalities in well-being. Policy makers should particularly learn from inequalities in well-being.

For example, the most recent World Happiness Report argues that well-being inequality captures the subjective experience of inequality better than objective measures of income inequality. And this is really relevant, as it seems that it’s the subjective experience of inequality that has driven many people to feel frustrated with seemingly distant elites. This frustration has found expression in many election results across the globe. For example, in the referendum on whether the UK should remain in or leave the European Union. How can well-being inequality be reduced? Research by Jan Delhey and others has found that differences in social cohesion and trust matter for well-being in a society. Well-being outcomes and welfare policies are closely linked.

Evidence from cross-national research shows that more encompassing welfare states, aiming for more social and gender equality almost always perform better across a range of well-being measures. A well-funded and functioning welfare state, based on solidaristic principles can play a critical role in securing societal well-being as a whole from which everyone benefits. The welfare state, through its comprehensive health, education, pensions, and care services, plays a key role in securing economic growth. It provides the infrastructure to support and develop human capital in the form of a healthy workforce equipped with the necessary skills demanded in the modern economy.

The role of welfare policies is to provide a safety net and encourage people to reach their potential, irrespective of where, when, and to whom they were born. While most European states have developed such safety nets, Nordic countries are often seen as particularly successful in this respect. If we look at countries like Finland or Denmark, amongst the happiest nations and the most socially progressive countries in the world according to international surveys, we see that welfare policies take a life course perspective and are based on the idea that paying high taxes yields returns for everyone at different stages in their life. The welfare model is based on an intergenerational contract.

Welfare policies are seen less as a heavy cost than in many other countries, but more as an investment in people, with the aim of creating a sustainable model that is also socially just. Whatever well-being indices and rankings show, it’s worth keeping in mind that numbers or rankings do not mean anything on their own, and need to be complemented by meaningful conversations that can be reported alongside. It really is the debate about well-being that invites considerations of social goods and encourage policy to move away from the dominant and unhelpful focus on social harms.