Global debates about human wellbeing have increasingly centred on sustainability and the ambitions of the Sustainable Development Goals (SDGs), established by the United Nations (UN) to guide economic development and social progress across both developing and advanced economies. Institutions like the United Nations Development Programme (UNDP) and the Organisation for Economic Co-operation and Development (OECD) have relied on wellbeing measures such as the Human Development Index (HDI) to track changes in living standards, public health, access to healthcare, and prospects for a healthy life.
Drawing on large datasets, long-term time series, and comparative case studies, the growing body of work on quantitative measures of wellbeing has examined socio-economic conditions, gender equality, and environmental pressures, such as biodiversity loss, within a broader global ecosystem of policy analysis. For example, tools like the World Happiness Report and the Better Life Index have started to incorporate subjective wellbeing as well as more objective indicators. Together, these frameworks have become central to understanding wellbeing trends across different countries, and to assessing whether global development pathways are genuinely improving human lives.
For decades, economic growth, rising life expectancy, and expanding education underpinned optimism about global progress. However, research conducted by Emeritus Professor Quentin Grafton, from the Crawford School of Public Policy at the Australian National University, challenges the assumption that human wellbeing will continue to improve universally.
In a recent conversation with Professor Kevin Fox, from the School of Economics at UNSW Business School, following his presentation at the UNSW-ESCoE Conference on Economic Measurement, Professor Grafton outlined evidence suggesting that while some countries continue to flourish, global human wellbeing as a whole may be peaking, particularly once the impacts of climate change are taken into account.
Drawing on data from more than 150 countries, the discussion explored how wellbeing is measured, why progress is slowing or reversing in many parts of the world, and what this divergence implies for equity, climate policy, and international cooperation.
Measuring wellbeing beyond GDP
What does it mean to measure human wellbeing? Prof. Grafton emphasised that no single indicator is fully capable of capturing it. “You can measure it in multiple ways. A standard economic way of measuring it would be GDP or gross domestic product per capita, adjusted for international prices,” he said.
But income alone is often insufficient. Prof. Grafton pointed to broader composite measures that incorporated health and education, as well as subjective assessments of life satisfaction. “So, for example, education, life expectancy at birth, and then there are other measures that can broaden it out even further,” he said.
“You can also measure wellbeing using survey-based approaches. One example is the life evaluation index, which asks people to imagine their life as a ladder and rate it from one to ten, with ten being the best possible outcome.”
This multidimensional approach allowed researchers to compare wellbeing across countries and over time, revealing patterns that would have remained invisible if GDP had been the only metric. Crucially, it also enabled analysis at a global scale, where differences between countries mattered more than averages within them.
“And then if you're doing it at a global scale, you obviously have to have it at least a country level,” he said.
The difference between “flourishing” vs “languishing” countries
When the data was analysed over the long term, it revealed that global human wellbeing did not improve universally.
“There is a common presumption that things will continue to get better for most of humanity,” Prof. Grafton said. “We came at it by saying, well, what does the data tell us? And the data tells us a story that's not the standard extreme.”
In the research, Prof. Grafton identified a group of around 20 “flourishing” countries (mostly high-income economies such as Australia) that already scored highly on income, life expectancy, and composite wellbeing measures, and were projected to continue improving beyond mid-century. “They're not only high, but they're going to get even higher, according to our trend analysis, at least past 2050,” he said.
But this positive trajectory did not extend to most of the world. Many countries, particularly in Africa, had reached or were reaching their peak levels of income and life expectancy. “There are a bunch of countries, dozens and dozens of countries, where they are peaking in terms of their gross domestic product or some income measure per capita and life expectancy at birth,” Prof. Grafton said.
These countries were not just peaking sooner; they were peaking at much lower levels of wellbeing than today’s high-income nations. “They will peak at levels much less than the current levels of life expectancy at birth and also gross domestic product per person that Australia currently enjoys,” he said.
The implications are profound. For more than half of the world’s population, global human wellbeing appeared to be approaching its high-water mark within the next 25 years. “For most of the world, the answer [to whether global human wellbeing has peaked] is it's going to peak in the next 25 years.”
The impact of climate change on wellbeing inequality
Climate change has only intensified these existing inequalities. While all countries will be affected, the scale of the damage is likely to vary significantly. “All countries are worse off with climate change. It doesn't matter where you are; everyone's going to be worse off relative to not having climate change,” said Prof. Grafton.
However, the proportional impacts will be far greater for low-income countries. “First of all, if you simply look at the impact on GDP, or some measure of per capita income in 2050, the proportional impact is less, actually much less, on the upper, higher-income countries. It depends on the country. Geography matters here, but we're looking at somewhere between three to 5% maybe 6%.”
He continued: “If you look at low-income countries – those with per-capita incomes below US$4,000 – the impacts are much larger. While outcomes vary by country, projected losses are typically in the range of 10 to 15%.”
These losses could be especially damaging for countries that are already stagnating. Unlike wealthy nations, they cannot rely on future growth to absorb climate shocks. “So that means they won't be higher, and so that proportional impact will be even worse. So the difference between the two sets of countries is really big,” Prof. Grafton said.
This inequality raises fundamental questions about how cross-country transfers from flourishing nations to struggling ones might reduce the gap. Prof. Grafton said: “We looked at countries with per-capita incomes above US$40,000 and asked what could be done if some form of transfer were available. For countries with incomes below US$4000 per person, the potential impact is enormous, sometimes equivalent to 50 per cent, or even 100 per cent, of their current GDP.”
Such transfers require strong institutional safeguards and cannot substitute for domestic reform. But without support, the alternatives are stark. “What we're going to face, they're going to have to face two possibilities, really. One is higher rates of mortality, probably substantially higher rates of mortality or migration.”
While data alone cannot solve these problems, without careful measurement and analysis, policymakers will lack the tools needed to respond effectively. “It always starts with a problem, and then the only way you can respond to that is to have a look at the data.”
Professor Kevin Fox is Director of the Centre for Applied Economic Research (CAER) at UNSW Sydney. This article was originally published by UNSW’s BusinessThink research platform.
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