Monday, June 2, 2014

Do people with strong emancipative values give lower priority to economic growth?

This question is worth considering because previous posts in this series (links here) have discussed how economic development has been associated with the strengthening of emancipative values and more widespread opportunities. This means that the ongoing generation of more widespread opportunities for individual human flourishing depends on a substantial proportion of the population maintaining a fairly positive attitude towards economic growth.

The measure of priority given to economic growth that I have been using comes from World Values Surveys (WVS) which asks people to choose from four options what they consider to be the most important aim for the country they live in over the next ten years.  The options are: a high level of economic growth; strong defence forces; people have more say about how things are done at their jobs and in their communities; and trying to make our cities and countryside more beautiful. I have used the percentage for whom economic growth is first choice as an indicator of priority given to economic growth.

The perception that non-economists have of economic growth may be a much more defensible concept than growth in per capita GDP as conventionally measured. I don’t have concrete evidence, but I suspect that when non-economists favour economic growth what they have in mind is expansion of economic opportunity, rather than a particular income concept.

Before looking at the evidence I thought that people who have strong emancipative values would tend to give relatively low priority to economic growth because “people have more say” is one of the items which Christian Welzel used in constructing his emancipative values index for his book, Freedom Rising. By definition, people who give highest priority to 'more say', give lower priority to economic growth.

My main focus is on the extent to which the priority given to economic growth by people who hold emancipative values differs from that of the population as a whole in wealthy countries. Except where indicated, I have selected indicators from the latest WVS round which correspond to components of Welzel’s index. Countries included in the analysis are those with relatively high incomes for which data is available in the latest round of surveys i.e. 2010-14. (New Zealand is excluded from the analysis because of a high non-response rate on the question relating to priority given to economic growth.)

As a preliminary exercise, Chart 1 compares the overall average priority given to economic growth in each country with that given by members of different demographic groups. There does not seem to be any consistent pattern of difference between various groups within countries, except perhaps a tendency for young people to give lower priority to economic growth.



Chart 2 compares the overall average with priority given to economic growth by people with different views on desirable attributes for children to learn at home. Independence and imagination reflect positive emancipative values, whereas obedience is considered as negative. Perhaps those who see imagination as a desirable quality may be slightly less enthusiastic about economic growth, but otherwise there does not appear to be a consistent pattern.




Chart 3 compares the overall average with those of groups expressing strong views on whether divorce, abortion and homosexuality are justifiable. Again, there does not seem to be any consistent pattern.




Chart 4 compares the overall average with the priority given to economic growth of people favouring gender equality. The chart shows some interesting facts e.g. people in Australia who strongly disagree that men make better political leaders than women are much less likely to view economic growth as having high priority than are other people in Australia. However, no consistent pattern of difference between the different groups in different countries is obvious.




Chart 5 compares the overall average with the priority given to economic growth of people who see protecting freedom of speech and giving people more say in government decisions as particularly important. In this instance a fairly clear pattern is evident – a lower percentage of those holding emancipative views give high priority to economic growth.
This chart also shows the growth priority of those who consider protecting the environment should be given priority, even if it causes slower economic growth and some loss of jobs. This item is not a component of Welzel’s emancipative values index, but it also worth considering the priorities of those who see environmental protection as having high priority. As would be expected given the wording of the question those who consider protecting the environment should have high priority are less likely to give high priority to economic growth. However, the difference is not as large as I thought it might be.





The general conclusion that I draw from this exercise is that there is not a consistent tendency for people with strong emancipative values to give lower priority to economic growth than is given by other members of the populations of wealthy countries. People who attach great importance to having “more say” seem to be less inclined than the rest of the community to see economic growth as having high priority, but that observation does not apply consistently to people who attach importance to individual autonomy, respect choices that individuals make in their personal lives and favour gender equality. As a general rule, the differences in economic growth priorities of people in different countries are more marked than the differences between different groups within countries.

Monday, May 26, 2014

How have attitudes towards economic growth changed since the 1990s?

This question is of some interest in its own right, but my interest also stems from the relationships between the priority which people give to economic growth, growth outcomes and emancipative values that promote widespread opportunities. One particular issue that I want to explore is whether the growth of emancipative values must eventually come to an end because it involves, among other things, more emphasis on “people having more say in how things are done” (e.g. workplace democracy) rather than economic growth. My last post explains the context more fully.

For a couple of decades now, World Values Surveys have been asking people to choose from four options what they consider to be the most important aim for the country they live in over the next ten years.  The options are: a high level of economic growth; strong defence forces; people have more say about how things are done; and trying to make our cities and countryside more beautiful.

The focus of the following analysis is on the United States, Sweden, Australia and New Zealand. Sweden is of particular interest because it has high and rising emancipative values, the US is of interest because it is at the centre of the universe, Australia is where I live and NZ is nearby - just across the ditch. The surveys were conducted in 1995-98, 1999-04, 2005-09, 2010-14 (referred to respectively below as 1996, 2002, 2007 and 2012). I accessed the data using the World Values Studyonline data analysis facility – which is great for this kind of exercise.

The first chart shows how the priority given to economic growth has changed over time for all four surveys for which data are available and the second shows in more detail how priorities have changed since the mid 1990s.





The first chart shows that people in the United States tended to give relatively low priority to economic growth at the time of the first three surveys. The second chart suggests that the increase in priority given to economic growth in the latest survey has occurred at the expense of a decline in priority given to people having more say. The change in priorities presumably reflects a tendency for people in the US to feel poorer following the GFC.

The relatively high priority given to economic growth in Sweden in all four surveys is particularly interesting in the light of the high and rising emancipative values in that country. It seems likely that priority given to economic growth in Sweden was lower during the 1980s, before an economic crisis in the early 1990s. The WVS indicate that priority given by people in Sweden to having more say (aims of respondent data) was certainly much higher in the early 1980s than in the mid 1990s.


This analysis supports the general conclusion that I have been coming to from previous posts that my doubts about whether the rise of emancipative values in wealthy countries will be sustainable may not be well founded. There seems to be fairly strong grounds for optimism that voters in wealthy countries are capable of managing the tension between their non-economic social objectives (e.g. their desire to have more say) and their desire for the things that economic growth can buy.

Monday, May 19, 2014

Which countries have national ideologies that support widespread opportunities for individual flourishing?

If you have not been following this blog closely you might find my answer to this question to be surprising.

Perhaps I should begin by listing some propositions that are supported by earlier posts in this series:
  1. As economic development enables people to satisfy their material needs to a greater extent they tend to adopt emancipative values which enable more widespread opportunities for individual flourishing. See my review of Freedom Rising by Christian Welzel.
  2. Further strengthening of emancipative values will require prevailing social norms and ideologies to support economic development. The chances of economic development are improved when prevailing social norms and ideologies support economic freedom. See: ‘Can the industrial revolution be explained by the"cool-water condition"?’ and ‘Are culture and economic freedom substitutes or complements in facilitating economic development?’.
  3. There is evidence that, other things equal, individualistic societies tend to have smaller governments and that countries with high emancipative values tend to be individualistic. See my discussion of research by Gizem Arikan.
  4. There has not been a general tendency for economic freedom to either rise or fall over the last few decades in wealthy countries with rising emancipative values. Economic freedom has fallen in some such countries (e.g. US and Japan) and risen in others (e.g. Sweden and Norway). See: What is the relationship between emancipative values and economic freedom?
  5. There is evidence that economic freedom tends to rise in countries with a strong economic growth ideology i.e. where people consider economic growth should have high priority as a national aim and have attitudes favourable to scientific advances. See my last post.


So, one way to answer the question of which countries have national ideologies that support widespread opportunities for individual flourishing is to use the results of the regression analysis in my last post to identify the high income countries which have growth ideologies which are predicted to result in increased economic freedom. The answer is provided in the following chart, in which countries with relatively high average incomes (above $25,000 in US 2005 dollars) are shown with a red marker.


Click the chart to get a better view.



One problem with the answer provided in the chart is that it is based on surveys conducted during the 00s. In my next post I will consider whether more recent WVS survey data relating to growth ideology shows a different picture.

Monday, May 12, 2014

Can we identify the characteristics of national ideologies that promote economic freedom?

I have had to revise my views about the characteristics of national ideologies that promote economic freedom after undertaking some  research using World Values Surveys (WVS). I used data from surveys conducted around 2000 and during the first decade of this Century.

The set of questions I thought would be most relevant relate to such things as attitudes to competition, potential for hard work to lead to success, wealth accumulation, income inequality, government ownership and increased government responsibility. So, I spent a few hours standardizing data in order to average it and derive an index of economic policy attitudes. 

The next set of questions that I thought would be relevant relate to confidence in major companies and confidence in organisations that tend to interfere with markets (the government, political parties, parliament and civil service). I thought that economic freedom was more likely to increase in countries where there was greater confidence in big business than in government agencies.

Another question that I thought might be relevant asks people to choose from four options what they consider to be the most important aim for the country over the next ten years.  The options are: a high level of economic growth; strong defence forces; people have more say about how things are done; and trying to make our cities and countryside more beautiful. I thought that people who favoured a high level of economic growth might possibly tend to favour increased economic freedom. I wasn’t over-confident about that, however, because people who claim to be in favour of high economic growth often seem to me to be inclined to espouse hair-brained ideas for government interventions to advance that objective.

Finally, I thought a question relating to opinion about scientific advances might be relevant. I wasn’t sure whether people who are confident about scientific advances might be more prone to think rationally about economic policy, or whether they might be prone to scientism and have an irrational attachment to government planning. Anyhow, I also included a variable based on the percentage in each country who think that scientific advances are likely to help mankind.

The regression model sought to explain change in economic freedom over the period 2001 to 2011 in terms of initial economic freedom, as well as the four variables discussed above. My rationale for including the initial level of economic freedom is that the higher the initial level of economic freedom, the more favourable ideology must be in order to produce a further increase in economic freedom. The estimated coefficient on that variable was negative, as expected.

However, to my surprise, the estimated coefficients on the economic policy and confidence in business variables had the ‘wrong’ sign and were not significantly different from zero. Leaving those variables out of the analysis made very little difference to the estimated coefficients on other variables. Regression estimates for the revised model are as follows:
Intercept                                 1.250   (0.734)
Economic Freedom 2001        0.740  (0.081)
Economic growth priority       1.058   (0.377)
Science helps                          0.449   (0.373)
Adj. R2                                     0.60

Changes in economic freedom predicted by the model are compared with actual changes in economic freedom in Chart 1.



The outliers in the chart are of some interest because they show the importance of factors other than the prevailing growth ideology of the population – an obvious factor is political leadership – in causing changes in economic freedom. The results support the view that the anti-economic freedom policies followed in Venezuela and Argentina, for example, do not have much support from the populations of those countries.


The results of the regression analysis suggest that a country like the US or Australia with a relatively high level of economic freedom (i.e. a rating of about 8)  would need to have prevailing attitudes toward economic growth that are around average (relative to the countries included in the analysis) in order to avoid a decline in economic freedom. That may actually be less likely to happen than you might think because people in countries like the US and Australia tend to give lower priority to economic growth than do people in countries with lower average income levels. I will discuss the implications in my next post.