A Happy Society Is An Entrepreneurial Society
In a recent article, I explored the importance of institutions to successful entrepreneurship. It perhaps stands to reason that if you have high-quality institutions your trust in them, and wider aspects of government, can also be high.
This has numerous benefits. For instance, research from Washington State University highlights how trust in government appears to be closely linked with our feelings of security at work and loyalty to our employer.
The researchers surveyed several hundred American adults about their trust levels in both state and federal government, as well as a number of work-related issues, such as their wellbeing levels. The results revealed that higher levels of trust in government were linked with better workplace attitudes and overall wellbeing.
“It may come down to what it means psychologically to be able to trust in entities other than yourself, whether that’s the federal or state government, your organization or your supervisor,” the researchers explain. “It’s these internalized beliefs that another entity cares about my well-being and has good intentions—that kind of trust is crucial to facilitating relationships with other individuals and organizations.”
Similar findings were found in research from Stanford, which showed that trust in government was strongly linked with higher levels of entrepreneurship.
The researchers discovered that when South Korean president Park Guen-hye was impeached in 2016, it improved people’s trust in the government, which in turn increased people’s intention to start a new business within the next five years. What’s more, this was especially so for STEM graduates, whose technically-oriented businesses perhaps need more certainty than other forms of startup.
It’s perhaps no great surprise that trust in one’s government is also a fundamental factor in the overall happiness levels of society. Indeed, the latest World Happiness Report cites the strong correlation between trust in government and overall happiness, especially during the pandemic, where our health was so tightly linked with the effectiveness of our government.
“A central finding continues to be the extent to which the quality of the social context, especially the extent to which people trust their governments and have trust in the benevolence of others, supports their happiness before, during, and likely after the pandemic,” the authors explain.
This is clearly evidenced by the fact that Finland topped the happiness rankings for the 5th year in a row. The country, which also ranks 3rd in the OECD’s trust in government rankings, takes a distinctly matter-of-fact perspective on its happiness successes.
“We live in a society where everything functions, with education that is free, healthcare that is free, and everything is provided for in a secure and safe manner, so we focus more on the things that make people happy, such as creating government and institutions that just work,” Kari Klossner, Head of Smart Life Finland, Business Finland, says. “This then gives people the base and the outlook to be entrepreneurial as they have both the optimistic mindset all entrepreneurs need and the functioning institutions to help them.”
The Baltic country, which came 7th in the latest Global Innovation Index, has over 4,000 startups in Helsinki alone, many of which were founded by the talented engineers cut adrift after the demise of Nokia. This engineering prowess has been augmented by R&D institutions, including Aalto University and the Technological Research Centre of Finland VTT, which have developed ample intellectual property to build companies around.
For instance, IQM is a quantum computing business established in 2018 by researchers from VTT and Aalto. The company develops quantum processors for a range of supercomputing data centers and research labs, and employs around 160 people across Europe. Or you have Bluefors, which was spun out of Aalto’s predecessor, the Helsinki University of Technology in 2008 and develops ultra-low temperature systems that are vital for quantum computers to function.
There is clearly a lot to be said for a happy population, therefore, but achieving it is often easier said than done. Indeed, while Bhutan famously switched out Gross National Product for Gross National Happiness, most research into happiness suggests that it’s a byproduct of other things rather than something we can target specifically.
For instance, research from UC Berkeley found that those who actively sought out happiness were usually the least happy among us. Indeed, I’m sure many of us can attest to the prolonged torture of “forced fun” activities in the workplace. Usually, the more we try to enjoy something, the less enjoyable it becomes. Indeed, the UC Berkeley team has since shown that actively pursuing happiness can cause a spike in loneliness and disconnection.
On a national level, it might, therefore, pay to focus on trust as the first port of call to deliver a happier population. Analysis of countries across Asia found a strong association between trust in government, and other key public institutions, and overall happiness.
The Washington State University team reveals that trust in government has fallen considerably in the past 60 years. Whereas around 80% of people trusted the government in the 1960s, this has plummeted to around 20% today.
Regaining trust in government
There is clearly much to be done for governments to regain the trust of the public. Of course, achieving this is no easy feat. Researchers from Deloitte believe that a good place to start is to focus on four distinct areas:
- Humanity – so that the public has faith that you have the best interests of people at heart and genuinely care for their wellbeing. Things like kindness, fairness, and empathy are key here.
- Transparency – with the openness of information and motives, especially when related to policy and budget decisions. It’s also important to ensure that decisions are communicated clearly and in straightforward language.
- Capability – as the Finnish example demonstrates, it’s also vital that people have faith in their government to fundamentally deliver on its promises and deliver high-quality services.
- Reliability – these programs and services are delivered in a reliable and consistent manner to all constituents regardless of their location or demographic profile.
With faith in democratic governments generally in decline across the world, there is clearly a lot of work to be done, but if it can be achieved then the evidence suggests that it would result in a happier, more engaged, and more entrepreneurial society.