Rising GDP, Falling Generosity
- Adrian Xuereb Archer
- Aug 7
- 5 min read
A Call For A More Compassionate Society?
Malta’s economy has boomed in the last decade. Between 2012 and 2024, the country experienced a GDP growth of 253% and a GDP per capita growth of 146%. This is a striking figure for any nation, let alone a small island state. But the World Happiness Report of 2024 offers a perplexing story as generosity fell by 12% (and almost 30% before Covid). Seeing this question: What is happening to for our society to keep giving less when earning more?
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GDP vs Generosity: Are They in Opposite Directions?
GDP measures productivity. Generosity reflects a society’s willingness to give, help, and share. These two metrics rarely appear side by side—but when they do, the contrast can be striking. In Malta’s case, economic growth surged while generosity fell. This pattern isn’t unique. According to Wilkinson and Pickett (2009), societies with rising income inequality often experience a corresponding drop in social cohesion and trust.
While Malta’s overall GDP may have increased, the benefits might not have reached everyone equally. Together with a rising population, rising cost of living and increase in cost of property, this could be more complex than it looks. However, this led me to a difficult question: Does prosperity always mean progress? Or can growth come with social costs that don’t show up in economic charts?
GDP Per Capita: Statistical Wealth or Shared Abundance?
GDP per capita rose sharply since 2012. On the surface, this suggests that people are individually better off. But per capita figures are averages, they smooth over disparity. A handful of high earners can skew the metric without materially improving the lives of the majority. The Stiglitz-Sen-Fitoussi Commission (2009) warns that GDP per capita often misrepresents economic wellbeing, especially when distribution is uneven.
In Malta’s context, it's possible that the visible wealth is not broadly felt, creating frustration, resentment, or simply numbness. This calls into question whether rising GDP per capita has translated into a real sense of abundance for most citizens. And if not, could that explain why generosity, a proxy for social trust and connection, has deteriorated? Again given that 30% of our population is now expatriates, does the increase in GDP per capita reflect them too?
Cost of Living: The Invisible Pressure
Perhaps the most glaring tension appears in the relationship between generosity and the cumulative cost of living, which rose to 25% by 2024. This outpaces both GDP per capita and salary growth in many sectors. As basic expenses like housing, food, and energy rise, households may become more financially cautious, even defensive.
Research by Mani et al. (2013) found that financial scarcity directly impairs cognitive function and decision-making. People become more short-term focused, less empathic, and more self-protective. In other words, when people feel economically squeezed, generosity becomes an emotional and financial luxury. This brings forward another powerful question: When survival becomes expensive, does compassion become unaffordable?
Possible Causes: Complexity, Not Blame
It’s tempting to look for a single cause behind this divergence: inequality, inflation, migration & political tension. But the truth is likely more complex. Malta has seen cultural shifts in recent years, including increased urbanisation, housing speculation, digital transformation, and a rise in dual-income households.
Furthermore, the aftermath of the COVID-19 pandemic may still be affecting emotional resilience and civic behaviour. Generosity might not be disappearing—it could simply be evolving into forms that are not captured by traditional metrics, such as digital giving, informal networks, or environmental activism. The challenge, then, is not to assign blame, but to explore whether our old ways of measuring social health still apply.
Implications: The Rise of A Mental Health Epidemic
A sustained decline in generosity has wide-reaching implications. Without shared trust and civic-mindedness, even a prosperous society can feel hollow. People may retreat into individualism, deepen political divides, or lose faith in institutions. Mental health may deteriorate. Social alienation becomes the norm.
This is not abstract. The rise in mental health challenges in Malta, along with a growing demand for psychological services and a rise in anxiety-related searches (NSO, 2023), points toward a society under emotional strain, even as it flourishes economically.
In short, we may be facing a paradox of progress: materially richer, socially poorer.
Rethinking What We Measure
So, how might Malta (and other nations) respond? The question isn’t how to stop economic growth, but how to redefine what growth means. The 2019 Wellbeing Budget in New Zealand is one of the boldest examples of this shift. Rather than focus solely on GDP, it prioritised outcomes in mental health, child welfare, and indigenous community empowerment (New Zealand Treasury, 2019).
This is something that the Malta Vision 2050 is trying to address by including education and individual wellbeing as metrics for society. Yet it is my hope that this will not take till 2050 for us to see the fruits of that. Either way we need to ask ourselves: Do we want to become an infinite ATM machine without life, or do we want to enjoy the fruits of our labour?
Toward a More Compassionate Society
The numbers tell us something. So does their dissonance. Economic data points upward, but social indicators waver or fall. This is not a story of failure. Malta has seen monumental changes since 1970s let by multiple leaders and parties. For centuries the need for improving the finance of people was paramount. The idea was: if I have more money then I will be happy.
What we’re being invited into is not panic, but curiosity. How do we measure what matters? How do we grow not only in output, but in spirit? And how might Malta, small and adaptive as it is, lead the way toward a more holistic definition of prosperity? The final question, then, is this: Can we afford to keep defining success without including each other?
References
Mani, A., Mullainathan, S., Shafir, E., & Zhao, J. (2013). Poverty impedes cognitive function. Science, 341(6149), 976–980. https://doi.org/10.1126/science.1238041
Ministry for the Economy, Enterprise and Strategic Projects (2025). Malta Vision 2050. Government of Malta.
New Zealand Treasury. (2019). The Wellbeing Budget. https://budget.govt.nzStiglitz, J. E., Sen, A., & Fitoussi, J. P. (2009). Report by the Commission on the Measurement of Economic Performance and Social Progress. https://ec.europa.eu/eurostatWilkinson, R., & Pickett, K. (2009).
The Spirit Level: Why More Equal Societies Almost Always Do Better. Allen Lane.
World Happiness Report. (2024). Global Rankings and Data on Happiness and Generosity. https://worldhappiness.reportNSO Malta. (2023). Retail Price Index and Social Indicators. https://nso.gov.mt
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