Concept and Causes of Human Prosperity

This dissertation represents a comprehensive study of human prosperity. It consists of two main components separated into two essays. The first essay provides a theoretical definition and a measurement of prosperity. The second essay contributes a review of the institutional and cultural factors identified in the first essay, and examines their influence on the economic subset of prosperity. The definitions of the concept in Essay One, and the theoretical propositions of the determinants of prosperity in Essay Two, are found to be supported through a cross-country empirical analysis. By defining human prosperity as life-satisfaction, Essay One identifies the correlates of prosperity through an analysis of cross-country measures of subjective well-being using raw data from the World Values Survey (1981–2005). The study finds robust evidence that income, freedom, health, religious beliefs, stability, security, and family life are among the factors contributing to human prosperity. The methods consist of a factor analysis of the survey questions combined with an OLS regression. A sensitivity analysis, using three large and distinct samples of the population, validates the findings and enhances the power of the model. The final section in Essay One evaluates existing measures of prosperity and develops a new index based on the findings. The descriptive statistics and the regression outcomes, as well as the index of prosperity in the first essay, demonstrate evidence that cultural factors play a relatively modest role in defining the causes of prosperity, but a more robust role in generating prosperity. The first essay, therefore, provides the background for analyzing the causes of prosperity. Because of the immensity of such a project, Essay Two concentrates on the economic aspect of prosperity. The first section in Essay Two evaluates the frameworks used in the academic literature. Reviews of the literature lead to the establishment of a social theory that suggests how the cultural factors identified in the first essay may be incorporated into a framework that analyzes economic prosperity. The final section in Essay Two reviews and proposes a model of economic prosperity that includes cultural mechanisms and tests this theoretical model. The empirical results provide strong support for the importance of cultural factors to economic prosperity. A short summary chapter concludes the dissertation.