Things like universal healthcare, sanitation, education and decent wages require mobilising resources. Economic growth can absolutely help towards that end, and in poor countries it is even necessary. But the interventions that really matter when it comes to improving human welfare do not require high levels of GDP.

The relationship between GDP and human welfare plays out on a saturation curve, with sharply diminishing returns: after a certain point, which high-income nations have long surpassed, more GDP does little to improve core social outcomes. The relationship begins to break down.

In fact, there are many countries that manage to achieve strikingly high levels of human welfare with relatively little GDP per capita. We tend to see these countries as ‘outliers’, but they prove that the most important point is distribution. And what matters most of all is investment in universal public goods.

This is where things get interesting. Take life expectancy, for example.
The United States has a GDP per capita of $59,500, making it one of the world’s richest countries. People in the US can expect to live 78.7 years, nudging them just into the top 20%. But dozens of countries beat the US on this crucial indicator with only a fraction of the income. Japan has 35% less income than the US, but a life expectancy of 84 years – the highest in the world. South Korea has 50% less income and a life expectancy of 82 years. And then there’s Portugal, which has 65% less income and a life expectancy of 81.1 years. This is not a matter of just a few special cases. The European Union as a whole has 36% less income than the United States, and yet beats the US not only on life expectancy but on virtually every other indicator of human welfare.

Conclusion: GDP is a poor measure of human well-being, and yet our capitalist societies are all about growth.