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Where's The Best Place To Live? Prosperity Index Offers A Few Surprises

Believe it or not, this is not the best place in the world to live. You may be surprised at which country ranks at the top of the list.
Believe it or not, this is not the best place in the world to live. You may be surprised at which country ranks at the top of the list.
By Breffni O'Rourke
What's your idea of the best place in which to live?

Many people would probably answer that palm trees and a gleaming beach would be a good start to their idea of earthly paradise. But in real life, the country which scores best on a whole range of economic and quality-of-life issues is a good deal colder.

It's Finland.

That's what the 2009 Prosperity Index issued by the British-based think tank the Legatum Institute finds. 

The Legatum Prosperity Index is now in its third year. Its inspiration stems from a speech that onetime U.S. Attorney General Robert Kennedy gave in 1968. He said that the economic indicator most used to measure a country's progress, namely gross domestic product, or GDP, measures everything "except that which makes life worthwhile."

THE TOP 10
1. Finland
2. Switzerland
3. Sweden
4. Denmark
5. Norway
6. Australia
7. Canada
8. Netherlands
9. United States
10. New Zealand

 
With this idea as their guiding light, the academics at the Legatum Institute set out to measure human well-being in an infinitely more complex way. They chose nine headings that seemed to sum up the most important ingredients for happiness.

These include, of course, a country's economic fundamentals, but also personal freedom, health, education, and a safe and supportive society. In addition, there are broad issues, like quality of governance and of domestic institutions, and whether there is space for entrepreneurship and innovation.

William Inboden of the Legatum Institute explains that the list is meant to broaden the thinking of both public and private individuals on the subject of what constitutes progress.

"Certainly it's targeted at government officials, because a number of factors involved in it relate to government policy, such as respect for human rights, respect for economic freedom and trade freedom and the like," he says. "But also we try to aim this at business leaders, the media, and interested citizens."

One interesting fact shown by the research is that only in the poorest countries does money have an effect on the satisfaction in life. Surprisingly, once a nation rises out of extreme poverty, increases in income play a decreasing role in happiness.

It also shows that many factors leading to prosperity are interdependent. For instance, where economic policies favor small business and innovation, these in turn help to build a broad base of economic stability.

Sound governance is also a key ingredient to prosperity, the report says. Individuals, not governments, are the builders of wealth and happiness. Yet governance is indispensable. Countries in which sound governance leads to satisfied citizens are also most likely to have the best economic fundamentals and the most entrepreneurial societies.

"Our working theory of prosperity is that it's the responsibility of governments to have wise policies, but also it's for the citizens to take control of their lives and seize the opportunities when they can," Inboden says.

Under the heading "History Is Not Destiny," the survey points out encouragingly that the highly ranked nations include not only those with a long history of productive economies. There are also those which a couple of decades ago were afflicted with poverty, oppression, and unhappiness.

For instance, Ireland, an economic disaster zone a generation ago, today occupies 11th place in the list of 104 nations.

Similarly, in one generation, Singapore, Taiwan, and South Korea have risen from nowhere to be star economies.

THE BOTTOM 10
95. Kenya
96. Algeria
97. Tanzania
98. Nigeria
99. Pakistan
100. Cameroon
101. Central African Republic
102. Yemen
103. Sudan
104. Zimbabwe
 
Back in Europe, nations such as Croatia, Estonia, the Czech Republic, Hungary, and Slovakia have emerged from communism and now score comparatively well in the prosperity index.

Croatia, for instance, occupies 35th place out of 104. Despite involvement in a crippling war in the 1990s, it manages today to achieve an "average" rating across the various headings with no weak points and even a "strong" performance in personal freedoms.

Fellow Balkan state Macedonia comes in at No. 59, with weaknesses in its economic fundamentals and personal freedoms. 

Iran is relegated to a position -- No. 95 -- near the end of the index, with failings in most categories, comprising economic fundamentals, democratic institutions, security and safety, governance, personal freedoms, and social trust. It achieves an average rating only in entrepreneurship, education, and health.

Uzbekistan does little better, occupying 92nd place, having the same number of faults as Iran, with a slightly differently spread. Failures are in education, democratic institutions, entrepreneurship, governance, personal freedoms, and social trust.

Kazakhstan, the largest of the Central Asian states, comes in somewhat better at No. 76, with similar failings, but lightened by an "average" score in entrepreneurship and innovation, and in economic fundamentals.

Russia is in 69th place, with one "strong" category, namely education, and five weaknesses, comprising domestic institutions, safety and security, governance, personal freedoms, and social trust.

In Eastern Europe, Ukraine is in 61st place, with weaknesses only in governance and social trust.

Belarus is further down, in 85th place, with its score evenly divided into "average" and "weak," the latter being the usual ones of governance, personal freedoms and social trust, plus entrepreneurship and domestic institutions.

Moldova lies between Russia and Belarus, in 78th place, with all the expected failings.
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Comment Sorting
Comments
     
by: Matthew Ajimati from: Varkaus, Finland
October 27, 2009 11:25
Surprisingly, this is unbelievable! I think Finland should not relent in being at the top, according to Legatum Prosperity Index 2009 result. But should improve in opening up their economies system for foreigners, most especially future leaders-students; regardless of language barrier or proficiency. This amongst others, is a key factor to leading and getting more internationalized. This country should encourage their labour force to embark on recruiting young foreign professionals.

Congratulations, Finland!

by: geogen from: 45km offshore New England
October 29, 2009 02:38
Congrats.

I would be thankful and humbled to be a citizen of beautiful Finland. Even if I don't speak the language, I would do what I could. keep up the good work, Finlandia and please continue being a fair, human example for all on Spaceship Earth..

Respects-

by: F Roma from: Toronto
October 30, 2009 20:02
How did the USA get into the top ten? Obama must have elevated the entire nation.

by: Hussain from: India
November 19, 2009 11:52
How come Australia listed in top 10 , when students from other countries who went there for studying are being killed and harrassed

by: Natasha from: Kingston, Jamaica
November 21, 2009 23:39
What happened to my country Jamaica?? Since we are the 3rd happiest nation in the world (even though Oprah didn't bother to feature us when she was featuring like places) *smile*

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