In 1972, the Bhutanese king declared that GNH was a more relevant measure of well-being than GDP. Bhutan’s Gross National Happiness establishes happiness and wellbeing as the main goal rather than a consequence of an end. However, more often than not, GNH is discarded as a utopian concept in academic literature. This article examines whether GNH can indeed be considered a practical alternative to GDP.
History of Gross National happiness
Gross National Happiness (GNH) is a balanced, holistic approach to development that was established by King Jigme Singye Wangchuck. The foundation for GNH begins with the objective of considering the collective happiness of all citizens, not merely as a collateral result but rather as the dominant end. The Royal Government of Bhutan states that the modern purpose of GNH is to maintain a balance between economic prosperity, environmental conservation, cultural and Mahayana Buddhist spiritual values, and good governance.
The measurement of happiness and well-being in GNH is based on four pillars: sustainable development, good governance, ecological protection, and cultural preservation. The four pillars can be further expanded into nine domains, which are measured using periodic national surveys and includes: standard of living, good governance, time use and balance, vitality, and diversity of community/ecosystem, health, education, and psychological well-being.
GNH vs GDP
In contrast to GNH, GDP measures the market value of goods and services produced within a country in a particular time period. GDP has been used as an indicator of well-being among several economies. However, Kuznets -the founder of GDP, himself wrote: “... the welfare of a nation can scarcely be inferred from a measure of national income” showing his lack of belief in using GDP as a tool to measure well being. Hence, GDP as a measure of economic progress does not specify happiness as the end goal but rather assumes it to be a collateral result.
Some of the major limitations of the current GDP index (as an indicator of wellbeing) include:
An increase in GDP has not been proportional to an increase in subjective well being
Kuznets did not intend for GDP to be an overall measure of well-being
The measurement is solely based on income and consumption and overlooks other important factors such as environmental, social, and human capital
It does not include qualitative factors like health and education contributing to economic prosperity
Such limitations question whether GDP can be used as an indicator of economic development because the goal of sensible economic development should be to create optimal conditions for individuals that are not limited to the market value of goods and services but focus on an overall improvement of living. Hence, such weaknesses of GDP challenge whether a new indicator of well-being such as happiness might be a better alternative.
GNH - a utopian concept?
Despite Bhutan’s deliberate effort in promoting gross national happiness over the gross domestic product through the direct implementation of public policies, can GNH have a practical implication on economic prosperity or is GNH a mere lip service used by Bhutan to obtain foreign attention and aid?
Since happiness itself is subjective, it leads to numerous interpretations of GNH ranging from Buddhist spirituality to social capitalism. Hence, there is a need for GNH to have a concrete, objective foundation else it is reduced to nothing but glamorous words. Some of the questions the Bhutanese government: What does GNH actually mean? How can it influence practical decisions? How can it be monitored and measured? To make GNH a concrete alternate paradigm and for it to be taken more seriously by academicians, Bhutan has been continuously inviting scholars and having annual conferences GNH as an alternative. Hence, most economists might argue that GNH is an imperfect measure and should be looked upon with caution.
But in Bhutan, it has become a yardstick by which to measure progress. The legal code of Bhutan states “if the government cannot create happiness for its people, then there is no purpose for the government to exist.” This is highlighted in accordance with the Easterlin Paradox states that greater happiness can be linked to a short-term increase in income but long-term rises in income are not met with a congruent increase in happiness. This is because of the assumption of decreasing marginal utility, whereby the utility of consuming a commodity decreases with an increase in quantity. Overall, the paradox depicts that the more you have or want, the less satisfied you will be. One of the main reasons why several economists believe more income leads to more happiness is because they have considered happiness at a point in time and not over an individual’s overall life cycle. Easterlin also pointed out that subjective measures of well-being such as family, healthcare, and political state are also important while determining the happiness of individuals. This shows a convergence between the ideologies of the western and Bhutanese lines of thought as a criticism of GDP as a sole measure of economic prosperity. However, the difference between the two is that the Bhutanese perspective towards GDP is through the lens of Bhutan as a Buddhist country. This might be also why the academia regards GNH as simply a desirable but not a feasible concept since religion plays a major role in conceptualizing Gross National Happiness.
Despite the criticism, over just a few spans of years since implementing GNH as a policy screening tool, the GDP per capita has increased exponentially from 1982 to 2010. Moreover, by enforcing environmental conservation as one of the pillars of GNH, 72% of Bhutan is under forest cover and Bhutan is recognized as a carbon-negative country. By preserving its tradition and culture, Bhutan has been able to maintain its unique identity and gain tourist attraction, bringing in further economic revenue to the small nation. Hence, although GNH may not be suitable for all nations worldwide, within the Bhutanese context, it is seen to be helping Bhutan move towards a more sustainable manner of economic development.
Although GNH has several limitations, through introspection by academic scholars and continuous improvement, Bhutan believes that GNH can be a substantial alternative paradigm and hopes for the usage of GNH, as a clear policy, to be more widespread.
(Written by Tshering Choden and Edited by Anoushka Gehani)