We need a wider perspective on a country’s potential to grow
What went wrong? The BRICs were chosen purely for their economic growth potential, and on this basis O’Neill was right to group them as he did. From the perspective of 2001, the BRICs showed a lot of economic promise: the demographic projections mostly showed labour force growth, their growth rates showed an ability to harness technological progress, and their investment rates were high.
But non-economic factors do not only matter, more generally, for prosperity – they matter for economic growth too. Over the past decade, the countries that have been among the strongest performers in rising up the prosperity rankings have shared certain common foundations: high scores in Education, Governance, and Social Capital. Education makes people more productive and better able to lead prosperous lives; good governance provides the policy stability needed for growth and the freedom that allows people to flourish; and strong social capital built on high levels of trust oils the wheels of commerce and improves individuals’ wellbeing.