Beyond GDP: Exploring the Growth–Subjective Well-Being Nexus in the Next Eleven Countries

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Gunduz S.

World Journal of Applied Economics, cilt.12, sa.1, ss.21-41, 2026 (TRDizin)

Özet

Although economic growth is often regarded as the primary source of better living stan- dards, the Easterlin Paradox suggests that higher income does not necessarily improve people’s subjective well-being (SWB). This study, using a panel data framework with Driscoll–Kraay standard errors, investigates the relationship between growth and SWB in the Next Eleven (N-11) countries from 2009 to 2019, moving beyond traditional income-based measures of well-being, including unemployment, institutional quality, and economic complexity. The findings show that higher unemployment reduces life satisfaction, while better institutional quality enhances it. Real GDP per capita has no significant effect once these factors are taken into account, supporting the Easter- lin Paradox. In addition to addressing the gap in growth literature on the association between economic complexity and SWB, which is found to be negative, a central con- tribution of the study is justifying the introduction of a “modernization tax”, referring to the social costs that often accompany rapid structural change; as economies trans- form, people may face job shifts, skill mismatches, and greater uncertainty, which can lower life satisfaction. Overall, improving job conditions and strengthening institu- tions appear more important for well-being than simply increasing income in N-11 countries, consistent with the United Nations 2030 Agenda.