by Josef A

Created on: June 18, 2009

The tiny country of Bhutan situated in the Himalayas somewhere in between India and China abolished the measurement of Gross National Product (GNP) and implemented the concept of Gross National Happiness (GNH) instead. How fantastic that is. Does that mean scientists trying to evaluate the economy are useless? Not quite - they are just not doing their job properly. Rather than optimizing the GNP they should optimize the GNH. It is a great idea and if there was any way to realize this concept it has my full support. It seems that people do often not consider why we are trying to increase GNP. It should be and some do indeed forget about that about increasing happiness and satisfaction of every individual. Critics say you cannot measure such a thing as happiness. I completely agree and happiness will always remain a subjective view on things (in Bhutan they e.g. count the amount of time people pray). Should we therefore discard the idea and continue with our old measure of success? Well, probably. However, I think there is a lot we could learn from the idea, although I agree that it is quite difficult to implement and measure happiness.

There are people who work so much they barely see their families and yet many people are out of work. Only taking pure economics into account longer working hours are about to win the upper hand again (although also in traditional economics it is a controversial issue). If we accept the premise that work enhances people's quality of life, we have to try to allocate work evenly so that everybody has the possibility to work. In the end those who used to work longer hours have more time for themselves and are potentially happier. In addition, they do not have to support the unemployed with an increased tax duty making up for their loss of income. The former unemployed are happy as work gives more meaning to their life. GNP growth might suffer a couple of digits after the comma, but the GNH would most likely rise. There are other examples where there is a potential conflict between the two measures such as when it comes to encouragement of consumption. Just to give a buzz word: Veblen's conspicuous consumption leaves many individuals with an abundance of luxury goods which do not promote happiness because others have the same or even more.

There is a lot that can be learned from that concept of GNH. Economic issues cannot merely be evaluated on grounds of monetary gains and sometimes economists should ask themselves whether it makes people happier as opposed to make them richer. To come back to our Himalayan nation, somebody still calculates Bhutan's GNP which is approximately $2000 per capita. I first thought the happiness concept might only be suitable for the rich Western world. Taking good old Maslow there is probably a lack of basic necessities in Bhutan. So it stands to reason that they made a virtue out of necessity. However, I haven't been there and who knows maybe the people in Bhutan can do without most things we consider absolutely essential and are overall happier than the materialistically wealthy of this world. A survey of the university of Leicester rates Bhutan as the 8th happiest country in the world with much wealthier countries lagging behind. The U.S. came in 23th.

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