Gross National Happiness

The tiny Himalayan kingdom of Bhutan is an unlikely place for the birth of an international trend. Yet Bhutan is emerging as a global leader in the promotion of "Gross National Happiness," a concept it first embraced three decades ago and which is now being fleshed out by a wide range of professionals and agencies across the world.

The term Gross National Happiness (GNH) was coined by Bhutan's King Jigme Singye Wangchuck, when he ascended the throne in 1972. It signalled his commitment to building an economy that would serve Bhutan's unique culture permeated by Buddhist spiritual values.

Today, the concept of GNH resonates with a wide range of initiatives, across the world, to define prosperity in more holistic terms and to measure actual wellbeing rather than consumption. By contrast the conventional concept of Gross National Product (GNP) measures only the sum total of material production and exchange in any country. Thus an international conference on Gross National Happiness, hosted by the Bhutan government in the capital city of Thimphu in 2004, attracted 82 eminent participants from 20 countries.

The evolving concept of GNH could well be the most significant advancement in economic theory over the last 150 years, according to Frank Dixon, a Harvard Business School graduate who is currently managing director of research at Innovest Strategic Value Advisors. Innovest is the largest international financial services firm catering to ethical investment funds.

"GNH is an endeavor to greatly enhance the sophistication of human systems by emulating the infinitely greater sophistication of nature," says Dixon.

Just what would it mean for economic structures to emulate nature? Dixon and others explain it as follows. At present individual companies and entire countries are compelled to keep growing indefinitely. The only parallel for this in the natural world is cancer cells, which by growing exponentially destroy the host body and themselves.

Today it is widely acknowledged that the human economy cannot keep growing at the cost of its habitat. Yet even after two decades of expanding environmental regulation we are still losing the race to save the planet. This is partly because production systems and consumption patterns are out of sync with the carrying capacity of the planet. The pressure for ever higher GNP is merely one manifestation of this.

The concept of GNH is seen as one of several ways in which these imbalances might be rectified. The international gathering at Thimphu reflected a consensus that Gross National Product would still need to be measured and given due importance but in ways that are actually conducive to GNH. So far there has been a tendency to treat GNH as merely the well-intentioned slogan of a small country ruled by an enlightened monarch. The obvious difficulties of defining or measuring happiness have also helped to keep the concept of GNH on the outer fringes of serious discourse.

However, as the conference in Thimphu showed, basic happiness can be measured since it pertains to quality of nutrition, housing, education, health care and community life. Thus, GNH may indeed be ready to come of age. The concept is essential for anyone working on development, says Mieko Nishimizu, an economist who was formerly the World Bank's vice president for the South Asia region and attended the Thimphu conference.

Three major factors seem to be responsible for the expanding credibility of GNH. One, there is wider awareness that GNP is a one-dimensional and thus misleading measure. Two, a wide range of indices have been devised which offer a more realistic assessment of even material prosperity. Three, there is growing pressure for an infusion of moral and cultural values into the core of economic policy.