The National: This is the latest edition of Gordon MacIntyre-Kemps' Reinventing Scotland newsletter, all about the wellbeing economy. To receive it free to your inbox every week, sign up here.

THE wellbeing economic approach aims to make quality of life, equality, fairness, happiness, and health outcomes that should be given equal weight to economic growth. 

Critics argue that wellbeing is subjective and cannot be measured. They are wrong.

The right want to double down on GDP as they believe that ‘a rising tide lifts all boats’ but growing inequality destroyed the trickle-down economics case.

The left see it as a threat to socialism and it is – it is equally a threat to capitalism, taking the best and workable elements of both systems and turning them to a higher purpose than just economic growth or shared ownership of the means of production.

There have been multiple attempts to measure the wellbeing economy

The Scottish Governments Wellbeing Economy Monitor was developed to be used alongside the already overly complicated and largely unfathomable National Performance Framework as a way to measure Scotland’s progress implementing a wellbeing economy. 

The Wellbeing Economy Monitor also lacks depth in how its measures are calculated.

For example, the measure of ‘Natural Capital’, an assessment of Scotland’s total environmental wellbeing, is measured by only two indicators: ‘Greenhouse gas emissions’ and ‘Biodiversity’, rendering it almost pointless, albeit an attempt to move in the right direction.

READ MORE: Scottish wellbeing economy requires consumers to change these habits

There are many articles and even books on meaning wellbeing with ideas ranging from unimaginative suggestions of wellbeing polls to overly imaginative ones such as measuring the daily potential to hear bird song.

Nobel prize-winning Economist Joseph Stiglitz's book Measuring What Counts is the most detailed. 

Scotland needs the data of an independent nation

The problem we face is that much of the data just isn’t easily available.

In particular, Scotland is not a nation-state and so much of the information we can find on other nations and indeed the UK just isn’t available for Scotland.

GDP includes a measurement of exports minus imports and we don't have solid data on Scotland’s exports and therefore GDP for the same reasons. 

The Scotianomics Wellbeing Index

Scotianomics is the wellbeing economy think tank arm of Business for Scotland; the business network that also runs the Believe in Scotland and Wellbeing Pension campaigns.  

Scotianomics has created the Wellbeing Economy Index which measures national indicators across five dimensions of wellbeing.

Each dimension is composed of sub-measures which are summed together to give a dimension score. These are then averaged to give each nation an overall Wellbeing Score.

This allows for easy comparison between nations and for policymakers to quickly understand in which area their nation needs improvement or strengthening. 

READ MORE: The Danish power station which should inspire Scotland's energy future

You cannot have a thriving economy without a thriving society, and you cannot have a thriving society without a thriving economy and your nation cannot thrive unless you can measure what wellbeing is.  

We were able to begin to estimate the wellbeing performance of nations using the data at hand.

The draft Wellbeing Economy Index has been published for peer review and a draft report shared with the Scottish Government.

Each dimension has as many as a dozen sub-measures. Using a traffic light system style the darker Green the stronger the score etc.

The dimensions of the wellbeing economy

  • Economy
  • Human Development
  • Living Environment
  • Community 
  • Future Proofing

Here are the top ten in the list compared with the UK (in 16th place).  We used a traffic light system style, the darker green the stronger the score etc.

The National:

With sometimes dozens of measures within each dimension, it presents a more robust measure of what nations are further along their journey towards a wellbeing economy.

There is still work to do but the initial findings are very interesting and allowed us to create a draft global performance index for the 36 OECD developed nations.  

The first thing that jumps out is that the top ten is dominated by small to medium sized Northern European nations. The Nordic/Scandinavian nations with similar sized populations to Scotland dominate the top five of the index.

Germany’s Mittelstand

The only larger nation to make the top ten is Germany but even Germany’s economy score is flagging along with all the larger nations. Germany’s economy is driven by small to medium-sized (often family-owned) manufacturing businesses, which they call the Mittelstand.

This has made Germany’s economy more robust than the UK’s finance and large PLC-led economy.

Its current economic slippage is due to the energy price shock and the need to – more rapidly than any other nation – distance itself from over reliance on Russian gas. 

READ MORE: When will Scotland start transitioning to a wellbeing economy?

Mittelstand businesses are often highly ethical in their employee relations, often have Union members on the board and deeper longer-term values-based relationships with customers and suppliers.

That’s a wellbeing economy approach right there.

Reinventing Scotland

Scotland as part of the UK is locked into a centralised form of government that is wedded to the London financial model. All the Westminster UK political parties will talk up wellbeing but they see it as a PR/tick-box exercise .

That is why Scotland needs independence because independence is not an end in itself but the chance to put wellbeing at the heart of government decision making and not on the periphery as it is now.

Setting Scotland's sights on a top five place on the Scotianomics Wellbeing Economy Index would be a great starting ambition for the independence project.