Beyond GDP: Bhutan’s Gross National Happiness Index

Beyond GDP: Bhutan’s Gross National Happiness Index Adopt Alternative Indicators

From 1972, the reign of the 4th Druk Gyalpo (King) Jigme Singye Wangchuck led Bhutan into a new phase of previously unseen modernisation. While in 1961 Bhutan had initiated its first 5 year socio-economic development plan, it wasn’t until over a decade later that wide-ranging socio-economic reforms led to improvements in education, rural development, urbanisation and tourism as well as a decentralisation of political power.

During the reforms, King Jigme Singye Wangchuck declared ‘‘Gross National Happiness [to be] more important than Gross Domestic Product [GDP]’, believing GDP an insufficient metric that places too much emphasis on material gain over personal mental and physical well-being, bio-diversity, poverty eradication and sustainability. Isolated for centuries, it was important for Bhutan to maintain its deeply rich culture, history, and Buddhist spiritual integrity throughout the modernisation process. Such far-reaching reforms had brought many tangible benefits to Bhutan, but there continued a deeply rooted belief that modernity had to be effectively managed, safeguarding a connection to Bhutan’s traditions and spiritual well-being.

At a Glance

GNH is a holistic framework for public policy-making and development planning, founded on four pillars: good governance, sustainable socio-economic development, cultural preservation and environmental conservation.

  • Under the GNH Index 2010, the four pillars have further been classified into 9 different domains of: psychological wellbeing, health, education, time use, cultural diversity and resilience, good governance, community vitality, ecological diversity and resilience, and living standards. These are broken down in turn into 72 different indicators that measure individual happiness, with 124 different variables.
  • The second (cross-indicator) cut-offs categorise the population into four levels of GNH, creating a ‘happiness gradient’ – unhappy, narrowly happy, extensively happy and deeply happy.


Policy Reference

The Constitution of the Kingdom of Bhutan (2008). [In English]

Article 9 – Principles of State Policy

(2) The State shall strive to promote those conditions that will enable the pursuit of Gross National Happiness.

Article 20 – The Executive

(1) The Government shall protect and strengthen the sovereignty of the Kingdom, provide good governance, and ensure peace, security, well-being and happiness of the people.


Connected Policies

The Constitution of the Kingdom of Bhutan (2008). [In English]

Article 3 – Spiritual Heritage

The spiritual traditions are the primary source of well-being, happiness and peace. Buddhism promotes the principles and values of peace, non-violence, compassion and tolerance. The Constitution maintains a balance between respecting the freedom of religion and preserving the religious heritage and accords appropriate recognition to the historical role of Buddhism in Bhutan.

Article 5

(2) The Royal Government shall: (a) Protect conserve and improve the pristine environment and safeguard the biodiversity of the country; (b) Prevent pollution and ecological degradation; (c) Secure ecologically balanced sustainable development while promoting justifiable economic and social development; and (d) Ensure a safe and healthy environment.

The Government shall ensure that, in order to conserve the country’s natural resources and to prevent degradation of the ecosystem, a minimum of 60% of Bhutan’s total land shall be maintained under forest cover for all time.

Parliament may enact environmental legislation to ensure sustainable use of natural resources and maintain intergenerational equity and reaffirm the sovereign rights of the State over its own biological resources.

awardsThe Constitution of the Kingdom of Bhutan, notably Article 5 (Environment) (2008) and forest related policies won an honourable mention in the 2011 Future Policy Award.


Selection as a Future-Just Policy

Bhutan is unique in that it is the only country in the world to have officially adopted Gross National Happiness over Gross Domestic Product, an unprecedented example of a state enacting legally binding policy that moves beyond GDP  and which focuses on providing a framework for the realisation of happiness.

Internationally Bhutan has championed GNH with it gaining political traction among many nations and also at the UN. One of the most difficult challenges countries have faced however, is the subjective and difficult nature of quantifying the concept of happiness.

In 2010 the Centre for Bhutan Studies developed the Bhutan GNH Index a sophisticated survey instrument that goes someway to solving this challenge. Through the creation of the index – which has been continuously updated and tuned – Bhutan has been able to formulate a scientifically robust metric for measuring GNH.

Bhutan offers an exclusive case in studying the application of GNH. There is much that can be learnt from the Bhutanese experience in terms of creating an economy for the common good.  GNH is an interesting alternative indicator that pertains to one of the fundamentally vital aspects of the human experience, as well as offering a multi-dimensional framework that can be used by policy-makers to enable the holistic creation and implementation of sustainable policies for future generations.


Future-just Policy Scorecard

Our “Best Policies” are those that meet the Future Just Lawmaking Principles and recognise the interconnected challenges we face today. The goal of principled policy work is to ensure that important universal standards of sustainability and equity, human rights and freedoms, and respect for the environment are taken into account. It also helps to increase policy coherence between different sectors.

    Sustainable use of natural resources

  • GNH is constructed on the pillars of sustainable socio-economic development and environmental conservation.
  • Bhutan is a world leader in the conservation of both its environmental and cultural resources.
  • Bhutan is a predominantly agrarian society with a limited number of polluting industries.
  • While Bhutan possesses one of the smallest economies worldwide, a major contributor to its impressive growth is renewable energy at 16.8% of GDP.
  • The Bhutanese economy is stimulated by investments in the hydropower sector and in terms of employment, the renewable natural resources sector remains the most important economic sector [UN Sustainable Development Report 2012]
  • Bhutan has been dubbed as the ‘crown jewel’ of the East Himalayas, a region recognised as a global biodiversity hotspot.

    Equity and poverty eradication

  • Bhutan may have very low GDP per capita, but it is ranked among the happiest nations in the world and leads efforts to place happiness on the global agenda.
  • Bhutan has been successful in achieving many Millennium Development Goals ahead of the 2015 targets, where between 1990 and 2012 poverty and the proportion of people that suffer from hunger were reduced by 50%.
  • Unfortunately, with its isolated location, late modernity and geopolitical position, poverty remains widespread in Bhutan. The UNDP Poverty Analysis Report 2012 indicates that 12.0% of the country’s population is ‘poor’ and that poverty in Bhutan is predominantly rural.
  • As part of Bhutan’s tenth 5 Year Plan, poverty reduction is a major priority of the Gross National Happiness Strategy as an overarching theme and primary goal.
  • The risk of people falling back into poverty remains, in particular for households engaged in agriculture.

    Precautionary approach

  • Pursuant to Article 5 (Environment) of the Constitution of Bhutan, every Bhutanese citizen shall ‘… contribute to the protection of the natural environment, conservation of the rich biodiversity of Bhutan and prevention of all forms of ecological degradation including noise, visual and physical pollution’.
  • As of 2015 more than 26% of Bhutan is managed under areas of protection to preserve the country’s rich biodiversity.
  • The Constitution mandates that at least 60% of the country is maintained under forest cover at all times. As a result of vast forest cover and limited number of polluting industries, Bhutan is among the few countries in the world with negative net greenhouse gas (GHG) emissions.
  • The Constitution’s protection of Bhutan’s forests was recognised with an honourable mention in the World Future Council’s Future Policy Award (2011).
  • As of 2015, 81% of the entire country is under healthy, unexploited and rich forest cover and one of the basic tenets of the country’s development philosophy is not to exploit it indiscriminately.
  • Despite an increase in Bhutan’s industrial output, from 2005 to 2010 Bhutan’s CO2 emissions (metric tons per capita) have only increased by 0.6 to 0.7, and remain significantly lower than the South Asia average of 1.4.

Public participation, access to information and justice

  • In 2008 Bhutan enacted their first constitution.
  • In 2008, the Bhutan Centre for Media and Democracy (BCMD) was established to develop a culture of democracy and by working in conjunction with existing media in the country, improve democratic processes by strengthening public discussion.
  • Under the reign of King Jigme Singye Wangchuck Bhutan transitioned from an autocratic to a democratic constitutional monarchy. However, since Bhutan has become a democracy there has been an increasing emphasis on using more traditional models of governance.
  • As of 2011 all levels of government are democratically elected.
  • The constitution of the Kingdom of Bhutan (2008), Article 8, Fundamental Rights, ‘guarantees the right to free speech, opinion, and expression.’ and ‘the right to information’.

    Good governance and human security

  • GNH is constructed on the pillars of good governance, sustainable socio-economic development, cultural preservation and environmental conservation- a multi-dimensional framework for interconnected public policy.
  • In the 1970s the Gross National Happiness Commission was created with the mandate of reviewing policy decisions and the allocation of resources.
  • At the end of the 1990s, the 4th King voluntarily devolved full executive powers to a Council of Ministers elected by the National Assembly. Shortly after, he ordered the drafting of a formal constitution: “It is my duty, as the King, to strengthen the nation so that the people can develop in security and peace, and the nation becomes more prosperous and secure than before.”
  • In 2006, the King announced that the time had now come to hand over the control of government to the people. In 2008, Bhutan saw its first parliamentary elections, and began a new system of governance.
  • However, in August 2013 the newly elected PM cast doubts on the use of GNH stating that while he supported the notion that “economic growth is not the be-all and end-all of development, GNH should not distract from tackling Bhutan’s pressing problems, including chronic unemployment, poverty and corruption… If the government of the day were to spend a disproportionate amount of time talking about GNH rather than delivering basic services, then it is a distraction.”
  • Bhutan’s has a track record of human rights abuses against minority groups, notably through the displacement of southern Nepalese immigrants.

    Integration and interrelationship

  • The formulation of GNH was to create a more holistic approach than GDP in understanding and measuring people’s overall welfare.

     Common but differentiated responsibilities

  • Overall, in 2010, 10.4% of people were ‘unhappy’, 47.8% are ‘narrowly happy, 32% are ‘extensively happy’ and 8.3% are ‘deeply happy’.


Context

“If the Government cannot create happiness (‘dekid‘) for its people, there is no purpose for the Government to exist.”

Desi Mipham Wangpo (Legal Code 1729)

Bhutan is a secluded mountainous Himalayan state that pursued a policy of isolationism for centuries. Wedged between the two powerful nations of China and India, Bhutan, during the latter half of the 20th century, began to emerge from isolation and strengthened its position as a sovereign nation state.

In 1961, Bhutan initiated its first 5 year socio-economic development plan. However, it wasn’t until 1972, when the 4th Druk Gyalpo (King) Jigme Singye Wangchuck came to the throne, that Bhutan entered a new phase of previously unseen modernisation. Described as a visionary reformer, King Jigme Singye Wangchuck pushed for wide-ranging socio-economic reforms, enabling improvements to education, rural development, urbanisation and tourism as well as a decentralisation of political power.

Preventing the erosion of Bhutan’s deeply rich culture, history, and maintaining Bhutan’s Buddhist spiritual integrity was nonetheless vital. There existed a deeply-rooted belief that modernity had to be effectively managed in order to safeguard a connection to Bhutan’s traditions and spiritual well-being.

In accordance with this philosophy, the King declared that ‘‘Gross National Happiness is more important than Gross Domestic Product [GDP]’, believing GDP to be an insufficient metric, placing too great an emphasis on material gain over personal mental and physical well-being, bio-diversity, poverty eradication and sustainability. The implementation of a GNH policy was particularly challenging though with regards to the simultaneous political transformation of the country.

After many years of planning and development, Bhutan has now developed a full socioeconomic framework for Bhutan’s five-year economic and development planning process. Proposed policies must pass a GNH review based on a GNH impact statement, therefore making GNH not only an alternative indicator in measuring Bhutan’s socio-economic growth, but also a principle mechanism in the creation of public policy.

In 2006, the King announced a transition to democracy. A new constitution was passed and in 2008, Bhutan saw its first parliamentary elections. As a constitutional commitment under Article 9, an obligation of the state is ‘to promote those conditions that will enable the pursuit of Gross National Happiness.’ Furthermore, in 2008, in-line with the Executive Order PM/01/08/895, the Planning Commission was renamed the Gross National Happiness Commission, and in addition to its existing responsibilities, the body assumed the responsibilities of the Committee of Secretaries. Its main task – as outlined in the executive order – was to ensure that GNH is embedded firmly into policies and that proper coordination is undertaken to ensure proper implementation of plans and programs.

By 2010, the Centre for Bhutan Studies developed a sophisticated survey instrument to measure the population’s general level of well-being called the ‘Bhutan GNH Index’. The index has enabled the creation of scientifically robust framework that can measure current happiness to guide the formulation and implementation of future policy.

In August 2013, the newly elected PM cast doubts on the use of GNH stating that while he supported the notion that “economic growth is not the be-all and end-all of development, GNH should not distract from tackling Bhutan’s pressing problems, including chronic unemployment, poverty and corruption…  If the government of the day were to spend a disproportionate amount of time talking about GNH rather than delivering basic services, then it is a distraction.”


Objectives

  • GDP was deemed to be an insufficient means of gauging Bhutanese socio-economic development, GNH would be developed into a multidimensional framework for a holistic approach to public policy-making.
  • GNH is based on the four pillars of good governance, sustainable socio-economic development, cultural preservation and environmental conservation.
  • These pillars of national policy are designed for the fulfilment of psychological wellbeing, health, education, time use, cultural diversity and resilience, good governance, community vitality, ecological diversity and resilience, and living standards.


Methods of Implementation

In 2006, the King announced Bhutan would transition to democracy. A new constitution was passed and in 2008, Bhutan saw its first parliamentary elections. As a constitutional commitment under Article 9, an obligation of the state is ‘to promote those conditions that will enable the pursuit of Gross National Happiness’, and is supported by Article 20, The Executive, I, that states that ‘the Government shall protect and strengthen the sovereignty of the Kingdom, provide good governance, and ensure peace, security, well-being and happiness of the people’. These two Articles make GNH a protected legally binding obligation of the government, centralising GNH to the formulation and implementation of future public policy

Furthermore, in 2008, in-line with the Executive Order PM/01/08/895, the Planning Commission was renamed the Gross National Happiness Commission, and in addition to its existing responsibilities, the body assumed the responsibilities of the Committee of Secretaries. Its main task – as outlined in the executive order – was to ensure that GNH is embedded firmly into policies and that proper coordination is undertaken to ensure proper implementation of plans and programs.


Impact

Bhutan is an isolated, landlocked country between China and India that still faces many difficulties in terms of poverty, human rights, trade and geo-politics. Though ‘five year plans’ were issued from 1972 in the pursuit of modernisation and socio-economic development, the country remains low in terms of human development rankings, placed 136 out of 187 countries by the UN Human Development Report (2013).

Relatively recently, Bhutan has transitioned to a decentralised democratic constitutional monarchy with a new constitution (2008). The creation of the latest GNH index in 2010, Bhutan possesses the most scientifically robust model in measuring happiness available to policy-makers.

Good governance

  • At the end of the 1990s, the 4th King voluntarily devolved full executive powers to a Council of Ministers elected by the National Assembly. Shortly after, he ordered the drafting of a formal constitution: “It is my duty, as the King, to strengthen the nation so that the people can develop in security and peace, and the nation becomes more prosperous and secure than before.”
  • In 2006, the King announced that the time had now come to hand over the control of government to the people. In 2008, Bhutan saw its first parliamentary elections, and began a new system of governance.

Sustainable socio-economic development

  • GNH is constructed on the pillars of sustainable socio-economic development and environmental conservation.
  • Bhutan is a world leader in the conservation of both its environmental and cultural resources.
  • Bhutan is a predominantly agrarian society with a limited number of polluting industries.
  • While Bhutan possesses one of the smallest economies worldwide, a major contributor to its impressive growth is renewable energy at 16.8% of GDP.
  • The Bhutanese economy is stimulated by investments in the hydropower sector and in terms of employment, the renewable natural resources sector remains the most important economic sector. [UN Sustainable Development Report 2012]
  • Bhutan has been dubbed as the ‘crown jewel’ of the East Himalayas, a region recognised as a global biodiversity hotspot.

Cultural preservation

  • Bhutan has national day of happiness on the 11 November coinciding with the birth anniversary of the fourth king.

Environmental conservation

  • As of 2015 more than 26% of Bhutan is managed as areas of protection preserving the country’s rich biodiversity.
  • Bhutan is dubbed as the ‘crown jewel’ of the East Himalayas, a region recognised as a global biodiversity hotspot.
  • The Constitution mandates that at least 60% of the country is maintained under forest cover at all times. As a result of vast forest cover and limited number of polluting industries, Bhutan is among the few countries in the world with net greenhouse gas (GHG) emission in negative.
  • As of 2015, 72% of the entire country is under healthy, unexploited and rich forest cover and one of the basic tenets of the country’s development philosophy is not to exploit it indiscriminately.

Internationally

“Happiness may have different meanings for different people. But we can all agree that it means working to end conflict, poverty and other unfortunate conditions in which so many of our fellow human beings live.”

Secretary-General Ban Ki-moon

Message for the International Day of Happiness, 20 March 2014

Internationally, GNH has gained widespread interest, critical acclaim and political traction with governments, think tanks, NGOs and academics. Many believe that measuring a nation’s wellbeing by its economic output is a dead policy, and are looking to alternative indicators, bringing happiness to the forefront of policymaking.

The General Assembly of the United Nations in its resolution 66/28 12 July 2012, proclaimed 20 March the International Day of Happiness, and stated the pursuit of happiness is a fundamental human goal” and embodies the spirit of the globally agreed targets known as the Millennium Development Goals (MDGs).

In 2012, the World Happiness Report ‘that reviews the state of happiness in the world today and shows how the new science of happiness explains personal and national variations in happiness’ was created.

In 2014, the government of Dubai launched its localised Happiness Index to measure the public’s contentment and satisfaction with different government services, and the United Kingdom launched its own well-being and happiness statistics.


Potential as a Transferable Model

“I believe that while Gross National Happiness is inherently Bhutanese, its ideas may have a positive relevance to any nation, peoples or communities – wherever they may be”

King Jigme Khesar Namgyel

Bhutan is the only country to have officially adopted GNH. To replicate the model elsewhere, new variables would have to be defined which are consistent with the national cultural and policy environment of the country. Despite the GNH framework reflecting Bhutan’s Buddhist origins, it is solidly based upon the empirical research literature of happiness, positive psychology and well-being, therefore making GNH a credible, useful and potentially transferable framework in moving beyond GDP.


Additional Resources

The Constitution of Bhutan 2008 [In English].

The Kingdom of Bhutan, GNH Official Guide.

National Report for the United Nations Conference on Sustainable Development 2012, Bhutan: In Pursuit of Sustainable Development.

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