Best countries in the World

Singapore

25 years ago according to the Economist's metrics USA was the undisputed best country to be born in, closely followed by large European nations like France, Germany and Italy. While these countries are still a great place to be born in, apparently they are not on the top anymore. Social and economic development in Northern European countries like Switzerland, Norway, Sweden, Denmark and Holland along with Australia and New Zealand in the southern hemisphere raced ahead. Biggest gainers are Singapore and the United Arab Emirates. Canada, Hong Kong and Austria are steadily among the top countries for the last 25 years. The biggest drop among the non-leading countries was suffered by Argentina, Hungary and Russia (former USSR).

According to another study done by the OECD, which is less complete and only includes 36 countries versus 80 in the Economist list the same countries are in the lead Today. Unfortunately the OECD list doesn't include the biggest gaining two countries Singapore and the UAE. Another list by city shows a similar pattern. Northern European, Canadian, Australian and US cities along with Dubai and Singapore are on the top. The cities top 50 list also includes a few unexpected Eastern European cities like Ljubljana, Brno and Prague and two Indian cities Bangalore and Pune too.

Let me attempt to make some generalizations from these statistics about what are the best policies in social organization that lead to wellness.

First of all, it's clear that the majority of the countries on top are capitalist democracies. These two elements are key. On one hand capitalism is the most efficient system for wealth generation. On the other hand, democracy prevents the concentration of wealth and power in one hand for too long. As Aristotle explained:

In a democracy the poor will have more power than the rich, because there are more of them, and the will of the majority is supreme.

Capitalism is the engine and democracy is the equalizer. Of course none of these systems are perfect, but they are the best we know of at this moment. As Winston Churchill said:

No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time.

What generates wealth and consequently well being is free and open trade closely guarded by the government even if rulers don't change as you can see with the biggest growing countries like Singpore ( People's Election Party is in power since 1968 ) and UAE ( Al Maktoum royal family has been in power for decades). Property rights and contracts are well protected by all top countries. This is key for entrepreneurs to be able to invest long term, take bigger risks resulting in larger rewards and create an ever increasing division of labor resulting in further efficiencies.

Second, natural resources can help tremendously but are not the key to well being. Well managed oil or precious metals can help a country, but it can also be a curse too. Easy money can erode work ethics and devalue other areas of the economy. Countries with fossil foil reserves or diamond mines aren't on the top by default.

Third, the wealthiest countries are also the cleanest. Industry and wealth generation doesn't mean the destruction of environment. In fact the statistics show is that the best way to save nature is to make people rich as fast as possible.

Fourth, income taxes can vary from very low to very high in top countries. In Singapore most people pay between 0-10% and UAE there is no income tax at all and both countries showed extreme growth. At the same time Northern Europeans, Australians and Canadians all pay relatively high taxes compared to the rest of the world and still manage to stay on top.

Finally, all top countries including the biggest growers invest heavily in health, education and other social issues. About 50% of tax income in Singapore is spent on social development. In Switzerland the biggest item of over 30% of the federal budget is social welfare. Australia spends about 40% of tax income on social causes. However such spending is not a guarantee to stay on top. The dethroned countries spend huge amounts on these programs too.

Conclusion: Wealth generated by free trade combined with a democracy that encourages smart management of natural resources and social services creates long term well being for a country. Self-sufficiency and dictatorships do not work on the long term.

The Economist index
OECD index
Best cities
Dubai, UAE
Gold Coast, Australia
Norway
Stockholm, Sweden

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