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Systems Thinking to Understand National Well-Being from a Human Capital Perspective

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  • Sibel Eker

    (International Institute for Applied Systems Analysis (IIASA), Laxenburg 2361, Austria)

  • Leena Ilmola-Sheppard

    (International Institute for Applied Systems Analysis (IIASA), Laxenburg 2361, Austria)

Abstract

Well-being has become an important policy goal to replace gross domestic product (GDP) as an indicator of national progress. Several multidimensional metrics and indicators of well-being have been developed mostly based on the four-capital model that includes natural, economic, human and social capital. These multidimensional measures of well-being, however, are highly categorical and lack a systems perspective that focuses on underlying mechanisms of the metrics and the interconnections between them. This study aims at bringing a systems thinking approach to understanding and measuring national well-being, particularly from a human capital perspective. For this purpose, we employ a qualitative systems mapping approach and identify the direct or indirect relationships between the well-being indicators related to human capital. The results show that the human capital system is governed by several reinforcing feedback loops through economic progress, health and life expectancy, which gives a central role to human capital to enhance well-being. There are balancing loops, however, that may have adverse effects on human capital formation and well-being, for instance through migration and ageing. Future studies can focus on the other three subsystems in the four-capital model, and on quantifying the relationships between different dimensions of well-being.

Suggested Citation

  • Sibel Eker & Leena Ilmola-Sheppard, 2020. "Systems Thinking to Understand National Well-Being from a Human Capital Perspective," Sustainability, MDPI, vol. 12(5), pages 1-19, March.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:5:p:1931-:d:327973
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    2. Ema Gusheva & Vincent de Gooyert, 2021. "Can We Have Our Cake and Eat It? A Review of the Debate on Green Recovery from the COVID-19 Crisis," Sustainability, MDPI, vol. 13(2), pages 1-16, January.

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