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01 / 05
Is This the Best Time to Be Alive?

Blog Post | Wellbeing

Is This the Best Time to Be Alive?

Overwhelming evidence shows that we are richer, healthier, better fed, better educated, and even more humane than ever before.

Imagine, if you will, the following scenario. It is 1723, and you are invited to dinner in a bucolic New England countryside, unspoiled by the ravages of the Industrial Revolution. There, you encounter a family of English settlers who left the Old World to start a new life in North America. The father, muscles bulging after a vigorous day of work on the farm, sits at the head of the table, reading from the Bible. His beautiful wife, dressed in rustic finery, is putting finishing touches on a pot of hearty stew. The son, a strapping lad of 17, has just returned from an invigorating horse ride, while the daughter, aged 12, is playing with her dolls. Aside from the antiquated gender roles, what’s there not to like?

As an idealized depiction of pre-industrial life, the setting is easily recognizable to anyone familiar with Romantic writing or films such as Gone with the Wind or the Lord of the Rings trilogy. As a description of reality, however, it is rubbish; balderdash; nonsense and humbug. More likely than not, the father is in agonizing and chronic pain from decades of hard labor. His wife’s lungs, destroyed by years of indoor pollution, make her cough blood. Soon, she will be dead. The daughter, the family being too poor to afford a dowry, will spend her life as a spinster, shunned by her peers. And the son, having recently visited a prostitute, is suffering from a mysterious ailment that will make him blind in five years and kill him before he is 30.

For most of human history, life was very difficult for most people. They lacked basic medicines and died relatively young. They had no painkillers, and people with ailments spent much of their lives in agonizing pain. Entire families lived in bug-infested dwellings that offered neither comfort nor privacy. They worked in the fields from sunrise to sunset, yet hunger and famines were common. Transportation was primitive, and most people never traveled beyond their native villages or nearest towns. Ignorance and illiteracy were rife. The “good old days” were, by and large, very bad for the great majority of humankind. Since then, humanity has made enormous progress—especially over the course of the last two centuries.

How much progress?

Life expectancy before the modern era, which is to say, the last 200 years or so, was between ages 25 and 30. Today, the global average is 73 years old. It is 78 in the United States and 85 in Hong Kong.

In the mid-18th century, 40 percent of children died before their 15th birthday in Sweden and 50 percent in Bavaria. That was not unusual. The average child mortality among hunter-gatherers was 49 percent. Today, global child mortality is 4 percent. It is 0.3 percent in the Nordic nations and Japan.

Most of the people who survived into adulthood lived on the equivalent of $2 per day—a permanent state of penury that lasted from the start of the agricultural revolution 10,000 years ago until the 1800s. Today, the global average is $35—adjusted for inflation. Put differently, the average inhabitant of the world is 18 times better off.

With rising incomes came a massive reduction in absolute poverty, which fell from 90 percent in the early 19th century to 40 percent in 1980 to less than 10 percent today. As scholars from the Brookings Institution put it, “Poverty reduction of this magnitude is unparalleled in history.”

Along with absolute poverty came hunger. Famines were once common, and the average food consumption in France did not reach 2,000 calories per person per day until the 1820s. Today, the global average is approaching 3,000 calories, and obesity is an increasing problem—even in sub-Saharan Africa.

Almost 90 percent of people worldwide in 1820 were illiterate. Today, over 90 percent of humanity is literate. As late as 1870, the total length of schooling at all levels of education for people between the ages of 24 and 65 was 0.5 years. Today, it is nine years.

These are the basics, but don’t forget other conveniences of modern life, such as antibiotics. President Calvin Coolidge’s son died from an infected blister, which he developed while playing tennis at the White House in 1924. Four years later, Alexander Fleming discovered penicillin. Or think of air conditioning, the arrival of which increased productivity and, therefore, standards of living in the American South and ensured that New Yorkers didn’t have to sleep on outside staircases during the summer to keep cool.

So far, I have chiefly focused only on material improvements. Technological change, which drives material progress forward, is cumulative. But the unprecedented prosperity that most people enjoy today isn’t the most remarkable aspect of modern life. That must be the gradual improvement in our treatment of one another and of the natural world around us—a fact that’s even more remarkable given that human nature is largely unchanging.

Let’s start with the most obvious. Slavery can be traced back to Sumer, a Middle Eastern civilization that flourished between 4,500 BC and 1,900 BC. Over the succeeding 4,000 years, every civilization at one point or another practiced chattel slavery. Today, it is banned in every country on Earth.

In ancient Greece and many other cultures, women were the property of men. They were deliberately kept confined and ignorant. And while it is true that the status of women ranged widely throughout history, it was only in 1893 New Zealand that women obtained the right to vote. Today, the only place where women have no vote is the Papal Election at the Vatican.

A similar story can be told about gays and lesbians. It is a myth that the equality, which gays and lesbians enjoy in the West today, is merely a return to a happy ancient past. The Greeks tolerated (and highly regulated) sexual encounters among men, but lesbianism (women being the property of men) was unacceptable. The same was true about relationships between adult males. In the end, all men were expected to marry and produce children for the military.

Similarly, it is a mistake to create a dichotomy between males and the rest. Most men in history never had political power. The United States was the first country on Earth where most free men could vote in the early 1800s. Prior to that, men formed the backbone of oppressed peasantry, whose job was to feed the aristocrats and die in their wars.

Strange though it may sound, given the Russian barbarism in Ukraine and Hamas’s in Israel, data suggests that humans are more peaceful than they used to be. Five hundred years ago, great powers were at war 100 percent of the time. Every springtime, armies moved, invaded the neighbor’s territory, and fought until wintertime. War was the norm. Today, it is peace. In fact, this year marks 70 years since the last war between great powers. No comparable period of peace exists in the historical record.

Homicides are also down. At the time of Leonardo Da Vinci, some 73 out of every 100,000 Italians could expect to be murdered in their lifetimes. Today, it is less than one. Something similar has happened in Belgium, the Netherlands, Switzerland, Germany, Scandinavia, and many other places on Earth.

Human sacrifice, cannibalism, eunuchs, harems, dueling, foot-binding, heretic and witch burning, public torture and executions, infanticide, freak shows and laughing at the insane, as Harvard University’s Steven Pinker has documented, are all gone or linger only in the worst of the planet’s backwaters.

Finally, we are also more mindful of nonhumans. Lowering cats into a fire to make them scream was a popular spectacle in 16th century Paris. Ditto bearbaiting, a blood sport in which a chained bear and one or more dogs were forced to fight. Speaking of dogs, some were used as foot warmers while others were bred to run on a wheel, called a turnspit or dog wheel, to turn the meat in the kitchen. Whaling was also common.

Overwhelming evidence from across the academic disciplines clearly shows that we are richer, live longer, are better fed, and are better educated. Most of all, evidence shows that we are more humane. My point, therefore, is a simple one: this is the best time to be alive.

Blog Post | Energy & Natural Resources

The Simon Abundance Index 2024

The Earth was 509.4 percent more abundant in 2023 than it was in 1980.

The Simon Abundance Index (SAI) quantifies and measures the relationship between resources and population. The SAI converts the relative abundance of 50 basic commodities and the global population into a single value. The index started in 1980 with a base value of 100. In 2023, the SAI stood at 609.4, indicating that resources have become 509.4 percent more abundant over the past 43 years. All 50 commodities were more abundant in 2023 than in 1980.

Figure 1: The Simon Abundance Index: 1980–2023 (1980 = 100)

The SAI is based on the ideas of University of Maryland economist and Cato Institute senior fellow Julian Simon, who pioneered research on and analysis of the relationship between population growth and resource abundance. If resources are finite, Simon’s opponents argued, then an increase in population should lead to higher prices and scarcity. Yet Simon discovered through exhaustive research over many years that the opposite was true. As the global population increased, virtually all resources became more abundant. How is that possible?

Simon recognized that raw materials without the knowledge of how to use them have no economic value. It is knowledge that transforms raw materials into resources, and new knowledge is potentially limitless. Simon also understood that it is only human beings who discover and create knowledge. Therefore, resources can grow infinitely and indefinitely. In fact, human beings are the ultimate resource.

Visualizing the Change

Resource abundance can be measured at both the personal level and the population level. We can use a pizza analogy to understand how that works. Personal-level abundance measures the size of an individual pizza slice. Population-level abundance measures the size of the entire pizza pie. The pizza pie can get larger in two ways: the slices can get larger, or the number of slices can increase. Both can happen at the same time.

Growth in resource abundance can be illustrated by comparing two box charts. Create the first chart, representing the population on the horizontal axis and personal resource abundance on the vertical axis. Draw a yellow square to represent the start year of 1980. Index both population and personal resource abundance to a value of one. Then draw a second chart for the end year of 2023. Use blue to distinguish this second chart. Scale it horizontally for the growth in population and vertically for the growth in personal resource abundance from 1980. Finally, overlay the yellow start-year chart on the blue end-year chart to see the difference in resource abundance between 1980 and 2023.

Figure 2: Visualization of the Relationship between Global Population Growth and Personal Resource Abundance of the 50 Basic Commodities (1980–2023)

Between 1980 and 2023, the average time price of the 50 basic commodities fell by 70.4 percent. For the time required to earn the money to buy one unit of this commodity basket in 1980, you would get 3.38 units in 2023. Consequently, the height of the vertical personal resource abundance axis in the blue box has risen to 3.38. Moreover, during this 43-year period, the world’s population grew by 3.6 billion, from 4.4 billion to over 8 billion, indicating an 80.2 percent increase. As such, the width of the blue box on the horizontal axis has expanded to 1.802. The size of the blue box, therefore, has grown to 3.38 by 1.802, or 6.094 (see the middle box in Figure 2).

As the box on the right shows, personal resource abundance grew by 238 percent; the population grew by 80.2 percent. The yellow start box has a size of 1.0, while the blue end box has a size of 6.094. That represents a 509.4 percent increase in population-level resource abundance. Population-level resource abundance grew at a compound annual rate of 4.3 percent over this 43-year period. Also note that every 1-percentage-point increase in population corresponded to a 6.35-percentage-point increase in population-level resource abundance (509.4 ÷ 80.2 = 6.35).

Individual Commodity Changes: 1980–2023

As noted, the average time price of the 50 basic commodities fell by 70.4 percent between 1980 and 2023. As such, the 50 commodities became 238.1 percent more abundant (on average). Lamb grew most abundant (675.1 percent), while the abundance of coal grew the least (30.7 percent).

Figure 3: Individual Commodities, Percentage Change in Time Price and Percentage Change in Abundance: 1980–2023

Individual Commodity Changes: 2022–2023

The SAI increased from a value of 520.1 in 2022 to 609.4 in 2023, indicating a 17.1 percent increase. Over those 12 months, 37 of the 50 commodities in the data set increased in abundance, while 13 decreased in abundance. Abundance ranged from a 220.8 percent increase for natural gas in Europe to a 38.9 percent decrease for oranges.

Figure 4: Individual Commodities, Percentage Change in Abundance: 2022–2023

Conclusion

After a sharp downturn between 2021 and 2022, which was caused by the COVID-19 pandemic, government lockdowns and accompanying monetary expansion, and the Russian invasion of Ukraine, the SAI is making a strong recovery. As noted, since 1980 resource abundance has been increasing at a much faster rate than population. We call that relationship superabundance. We explore this topic in our book Superabundance: The Story of Population Growth, Innovation, and Human Flourishing on an Infinitely Bountiful Planet.

Appendix A: Alternative Figure 1 with a Regression Line, Equation, R-Square, and Population

Appendix B: The Basic 50 Commodities Analysis: 1980–2023

Appendix C: Why Time Is Better Than Money for Measuring Resource Abundance

To better understand changes in our standard of living, we must move from thinking in quantities to thinking in prices. While the quantities of a resource are important, economists think in prices. This is because prices contain more information than quantities. Prices indicate if a product is becoming more or less abundant.

But prices can be distorted by inflation. Economists attempt to adjust for inflation by converting a current or nominal price into a real or constant price. This process can be subjective and contentious, however. To overcome such problems, we use time prices. What is most important to consider is how much time it takes to earn the money to buy a product. A time price is simply the nominal money price divided by the nominal hourly income. Money prices are expressed in dollars and cents, while time prices are expressed in hours and minutes. There are six reasons time is a better way than money to measure prices.

First, time prices contain more information than money prices do. Since innovation lowers prices and increases wages, time prices more fully capture the benefits of valuable new knowledge and the growth in human capital. To just look at prices without also looking at wages tells only half the story. Time prices make it easier to see the whole picture.

Second, time prices transcend the complications associated with converting nominal prices to real prices. Time prices avoid subjective and disputed adjustments such as the Consumer Price Index (CPI), the GDP Deflator or Implicit Price Deflator (IPD), the Personal Consumption Expenditures price index (PCE), and the Purchasing Power Parity (PPP). Time prices use the nominal price and the nominal hourly income at each point in time, so inflation adjustments are not necessary.

Third, time prices can be calculated on any product with any currency at any time and in any place. This means you can compare the time price of bread in France in 1850 to the time price of bread in New York in 2023. Analysts are also free to select from a variety of hourly income rates to use as the denominator when calculating time prices.

Fourth, time is an objective and universal constant. As the American economist George Gilder has noted, the International System of Units (SI) has established seven key metrics, of which six are bounded in one way or another by the passage of time. As the only irreversible element in the universe, with directionality imparted by thermodynamic entropy, time is the ultimate frame of reference for almost all measured values.

Fifth, time cannot be inflated or counterfeited. It is both fixed and continuous.

Sixth, we have perfect equality of time with exactly 24 hours in a day. As such, we should be comparing time inequality, not income inequality. When we measure differences in time inequality instead of income inequality, we get an even more positive view of the global standards of living.

These six reasons make using time prices superior to using money prices for measuring resource abundance. Time prices are elegant, intuitive, and simple. They are the true prices we pay for the things we buy.

The World Bank and the International Monetary Fund (IMF) track and report nominal prices on a wide variety of basic commodities. Analysts can use any hourly wage rate series as the denominator to calculate the time price. For the SAI, we created a proxy for global hourly income by using data from the World Bank and the Conference Board to calculate nominal GDP per hour worked.

With this data, we calculated the time prices for all 50 of the basic commodities for each year and then compared the change in time prices over time. If time prices are decreasing, personal resource abundance is increasing. For example, if a resource’s time price decreases by 50 percent, then for the same amount of time you get twice as much, or 100 percent more. The abundance of that resource has doubled. Or, to use the pizza analogy, an individual slice is twice as large. If the population increases by 25 percent over the same period, there will be 25 percent more slices. The pizza pie will thus be 150 percent larger [(2.0 x 1.25) – 1].

Blog Post | Economic Growth

Measuring Freedom and Flourishing | Podcast Highlights

Chelsea Follett interviews Leandro Prados de la Escosura about the long term trends in wellbeing, inequality, and freedom.

Listen to the podcast or read the full transcript here.

Let’s discuss your latest book, Human Development and the Path to Freedom.

I have spent many years working on economic performance in the long run, and while I don’t have anything against GDP, I was always uneasy with the idea of using GDP per head as a shortcut for wellbeing. GDP is a good indicator of output but a very deficient indicator of wellbeing.

Most economists say, “This is true, but it’s highly correlated with non-economic dimensions of wellbeing.” There is also a tendency to produce a dashboard of indicators, basically GDP and some additional measures that create a more nuanced picture.

I was unhappy with that. Then I realized that, since the beginning of modern national accounts in the 1950s, there have been attempts to produce alternative measures. More than 30 years ago, the United Nations Development Programme produced the Human Development Index. I was very interested, but at the same time, I was frustrated when I saw that countries with no freedom at all ranked very highly in the index.

For example, in the first report in 1990, they had a retrospect going back to 1975, and I found that Spain, under Franco’s dictatorship, ranked very highly in human development. How come? It wasn’t satisfactory to rank a nasty dictatorship so highly. And then I read the literature accompanying the report and found this very candid assertion: “The purpose of human development is to increase people’s range of choices. If they are not free to make those choices, the entire process becomes a mockery.”

This is an important philosophical point: Human development is not just about living longer or having a higher material standard of living. You can get that in a high-security prison in Norway. Choosing between alternative ways of life is what makes the difference.

To make a long story short, they have tried time and again to introduce freedom, but they never managed to do so because of strong political opposition from country members of the program. So, as an independent scholar, I thought, “Look, nobody is going to read it, but I have the freedom to introduce the freedom dimension.”

Tell me about what you found.

Perhaps what makes sense is to compare what I found to what you would get on the basis of per capita income. If you look at the average increase from 1870 to 2020, the growth in income and wellbeing is very similar.

But if you look closer, you realize there are large differences across different periods. During first globalization before 1913 and between 1970 and 2000, they are relatively close. During the last two decades, the difference is huge in favor of material living standards measured by per capita income. The first part of the 20th century is just the opposite.

What next? Well, try to provide an explanation.

I went in two steps. One was asking, “Why has this growth in human wellbeing happened? What is the intuition?” The intuition is that if you get richer, you’re going to become better fed, healthier, better educated, and freer. But you can also have different levels of wellbeing at the same income level, and the most important finding from a historical perspective is that at any point of income, you have higher wellbeing today than in the past.

If you compare 1870 to 1913, you see that for most of the income levels, you get the same association between health and income, but at high levels of income, you get higher levels of health. Improvements in health techniques and medical knowledge were restricted to the most advanced countries. But if you look at the 1950s, at any income level, you get higher levels of health than in 1913 or 1870. You also find this for education and freedom. If you move to 2000, there is another upward shift.

Of course, there are reversals. There have been four moments in time in which the progression, the positive progression of human development stopped or declined. One was the Great Depression. The second one was during Mao’s Great Leap Forward. Then there were the oil shocks in the early ’70s, but the most damaging one has been COVID. COVID is the first period in which wellbeing measured in terms of augmented human development has declined

However, over the long run, for any income level, whether you are rich or poor, nowadays you have higher wellbeing than in the past.

Those findings are fascinating. What would you say is the biggest implication of your work?

The first thing is that wellbeing, broadly defined, has expanded worldwide more steadily than per capita income.

Secondly, the phases in which we conventionally associate improvements in wellbeing are not necessarily the same as those in which actual wellbeing improved. For instance, there was an important improvement in the so-called interwar period, even though economic growth stagnated. In 20th-century India, before independence, there was a stagnation in real average income but a remarkable improvement in health. This was because of the discovery of the germ theory of disease, which brought simple hygienic practices like washing your hands before eating and not sleeping near animals.

We also tend to forget that the association between wellbeing and income is not fixed. There are movements along the function: if you are richer, other things being equal, you’re going to be healthier, more educated, and freer. But this is not the whole story. There are also upward and downward shifts.

For instance, you could say that in terms of freedom in 2020, we are worse off than we were 20 years ago. This doesn’t mean that people were richer 20 years ago—we’re richer now—but at the same income level, 20 years ago, people were freer than we are today.

So, it’s a nuanced picture. Overall, things are improving, but there are also worrying declines in freedom.

Exactly.

Can you talk about inequality?

In 1870, in the case of wellbeing, inequality was high, and it increased up to the end of the century, then went down. Then, because of World War I, it increased again. But from the late 1920s to the present, with the exception of a reversal because of World War II, there has been a steady decline in inequality of wellbeing.

In the case of per capita income, inequality increased until the end of the 20th century, around 1980, and only began declining after 1990.

Here, I’m referring to relative inequality. If we increase wealth by 10 percent everywhere, inequality in relative terms doesn’t change. Some people are a bit pickier and think, “If my income increases 10 percent and my income is 100, I get 110. If your income is 1000, you now get 1100.” This is absolute inequality.

Relative inequality in per capita income increased until 1980 and has declined since 1990. But absolute inequality in per capita income, the distance between rich and poor, continues growing.

Absolute inequality in wellbeing has declined since 1960. Today, it is similar to what you would find in 1938, 1913, or 1900, but higher than in 1870.

It’s also important to look at what happens to different parts of the distribution. Who are the winners and losers? Broadly speaking, the middle class of the world gained the most, and the lower classes and those at the top won relatively less. If you look at absolute gains, those who were at a higher level of wellbeing got more. But that changes for different dimensions. Those at the bottom, for example, were the main winners in terms of education, while those in the middle were the main winners in terms of health.

I know that your current focus is on freedom. Could you tell me a little bit about that?

I became interested in human development after reading Amartya Sen, who emphasizes what Isaiah Berlin would call positive freedom. Freedom to. But he also emphasizes negative freedom, the absence of coercion and interference. And I think this is interesting because many people think there is a trade-off between negative and positive freedom.

At the end of the day, everybody wants to have negative freedom, but there are those who think negative freedom has nothing to do with income, that would be Hayek, and those who think negative freedom can only be reached as a second stage once you provide for those who don’t have access. For some, positive freedom is a socialist lie to reduce negative freedom. For others, they are two faces of the same coin.

As an economic historian, I find this is an interesting topic for research. If you look at the world, and you can see this in the Human Freedom Index that Cato publishes, you see the countries at the top in terms of negative freedom are also at the top in terms of positive freedom. For instance, Denmark is at the top of the list in terms of economic freedom, but also in terms of education and health.

My question was, well, maybe this trade-off is only a short-run phenomenon. Maybe if you look at the long run, the trade-off doesn’t hold or only holds for a certain period. So why not construct two alternative sets of estimates, one for positive freedom and the other for negative freedom? And this is what I’m trying to do now.

My main discrepancy with the Fraser Institute economic freedom index is that I don’t take into account the size of government. I know this is a contentious issue. People say, “the larger the government, the less room for private initiative.” At a point in time, this is true. And if you look at similarly developed countries, this is true.

But if you take a cross-section at a point in time, you can see that there are countries in which the size of government is much, much smaller, that are not necessarily freer, in terms of absence of coercion and interference, than countries with larger governments. Look at, for instance, Latin American and Sub-Saharan African countries. Think of Somalia. Or think of my own country under Franco. It was a right-wing, but, in many aspects, very socialist dictatorship in which the government was everywhere. But the size of government was very small.

In 1980, do you know what percentage the income tax contributed to the revenues of the central government in Spain? Give me a figure. You would say 40 percent?

Sure, 40 percent.

2 percent.

Wow.

Nobody paid income tax. So, there was no redistribution.

My point is that the size of government matters less than the nature of government. Perhaps Denmark would have more economic freedom with a smaller government, but if you compare Denmark to other countries, you can see that even though the Danish government is larger, Denmark’s degree of economic freedom is higher. Why? Because the nature of government action is different. It doesn’t interfere as much as another government that is less intrusive in quantitative terms but more intrusive in qualitative terms.

So, if you are looking at a point in time, it makes sense to say, “mutatis mutandis, if a rich country nowadays has a smaller government, this country is going to be freer.” That is true. But the action of government varies from one case to another.

Get Leandro Prados de la Escosura’s book, Human Development and the Path to Freedom: 1870 to the Present, here.

The Human Progress Podcast | Ep. 48

Leandro Prados de la Escosura: Measuring Freedom and Flourishing

Leandro Prados de la Escosura, an emeritus professor of economic history at Carlos III University in Spain, joins Chelsea Follett to discuss long term trends in wellbeing, inequality, and freedom. To see the slides that accompany the interview, watch the video on YouTube.

Board of Governors of the Federal Reserve System | Economic Growth

Income Growth Over Five Generations of Americans

“We find that each of the past four generations of Americans was better off than the previous one, using a post-tax, post-transfer income measure constructed annually from 1963-2022 based on the Current Population Survey Annual Social and Economic Supplement.”

From Board of Governors of the Federal Reserve System.