Without a doubt, there is a connection between a country’s wealth and economic growth and improvements to its overall well-being. So rather than focusing solely on GDP per capita—the most frequently used indicator of a country’s general welfare—SEDA is primarily an objective measure that combines data on outcomes, such as in health and education, with quasi-objective data, such as governance assessments. It is also a relative measure that assesses how a country performs relative to either the entire universe of 152 countries or to individual peers or groups.
SEDA offers a current snapshot as well as a measure of progress over time, and it complements purely economic indicators like GDP. (See Appendix for details on the SEDA methodology.)
SEDA does not include purely subjective measures. Other metrics based on subjective measures—such as the ones used in the UN’s Happiness Report—offer valuable complementary, but separate, analysis. In fact, BCG has found a strong overall positive correlation between the UN’s Happiness scores and SEDA scores.
SEDA defines well-being on the basis of ten dimensions grouped into three categories.