On International Day of Happiness 2018

[pc: https://www.livehappy.com/relationships/community/celebrate-international-day-happiness]

The size of an economy and level of development is predominantly measured in terms of GDP. Economic progress has been determining the speed of development through the eyes of Kuznets and Stone via production, income and output. It has its roots in Adam Smith and the invisible hand as described in The theory of moral sentiments and The wealth of nations. Paul Samuelson viewed GDP as one of the great inventions of the twentieth century. None of these economists would have imagined that the nations would get so obsessed with GDP that all their policies and practices would target growth indicators surrounding GDP and the progress of nations would be measured and compared based on this key coinage.

 

It is discussed at length by economists and psychologists that improvements in GDP have not translated in enhancing life satisfaction of people.  Though their physical standard of living has improved manifold, their perception towards their life has not improved pari passu.  Physical infrastructure has been transformed which is able to provide comforts of so called good life yet it has added to many more problems at community and social level. The disparities have increased leaps and bounds, all type of value (human) erosion is happening, consumerism has taken the lead, materialism has penetrated into the minds of people almost everywhere.  Individuals are judged on the basis of wealth they possess. Though the nations are becoming economically developed, richer and independent, yet the problems of work-life conflict, discrimination, crime, depression, environmental imbalance, social alienations, etc., are on the rise. Gregg Easterbrook portrays in The Progress Paradox very nicely with the data from America and Europe that though in last half century physical infrastructure and standard of living have improved, yet it has not enhanced life satisfaction or happiness of people.

The last decade of the twentieth century witnessed emergence and popularity of HDI as an alternative to compare the status of nations. As it takes care of economic as well as social development, it has been recognized as a better measure to focus on public policy through improving health and education infrastructure and delivery. However policy outcome required to be gauged through looking at the satisfaction of people with the initiatives as well as improvement in their subjective well-being. It was felt that the policy direction should be such which targets welfare of citizens through empowering them. The public policy has to concentrate on developing better social infrastructure so that it takes care of economic indicators instead of the other way round.

Bhutan which was a tiny Kingdom before it adopted democratic system, has been practicing a development philosophy based on the premise of well-being of people, which is termed as Gross National Happiness (GNH).  It was towards the early months of 2008 when this tiny Kingdom became the youngest member of the club of parliamentary democracies.  It is more than 40 years since Bhutan started sharing its concern for the welfare of people through its focus on GNH.  There have been constant efforts to popularize the concept and advocate on the importance of happiness in the policy framework.  Wikipedia included this term and defines it as an attempt to define quality of life in more holistic and psychological terms than Gross National Product.  As mentioned in one of its national human development reports, the pursuit of GNH calls for a multi-dimensional approach to development that seeks to maintain harmony and balance between economic forces, environmental preservation, cultural and spiritual values and good governance.  These four priorities are termed as 4 pillars of GNH.

The study done by Takayoshi on comparing GNH and material welfare in Japan and Bhutan, on behalf of the Centre for Bhutan Studies traces the insight into the commonalities and differences.  Health, finance and family are some of the common indicators of well-being as perceived by the people of both the countries.  Japan is way ahead of Bhutan so far as GDP and HDI are concerned however when it comes to Happy Planet Index (developed by New Economic Forum, UK) or happiness index (developed by Adrian White of Leicester University, UK) Bhutan is far ahead of many of the developed nations including Japan, and developing nations.  It is precisely the reason why the focus of GDP is getting reduced and the social progress or well-being is getting focused.

Few years back Joseph Stiglitz visited Bhutan and addressed the policy makers, bureaucrats and development agents.  The focus of his address was the shifting from GDP to Well-Being as critically argued in a Report by the Commission on the Measurement of Economic Performance and Social Progress of which he was the chair.  This commission was initiated by the President of the French Republic, Nicholas Sarkozy in February 2008 when he felt unsatisfied with the state of statistical information about the economy and the society.  The mandate of the commission was to identify the limits of GDP as an indicator of economic performance and social progress, including the problems with its measurement; to consider what additional information might be required for the production of more relevant indicators of social progress; to assess the feasibility of alternative measurement tools, and to discuss how to present the statistical information in an appropriate way. The members conducted research on social capital, happiness, and health and mental well-being.

The report which is also named as Sarkozy Report, made a strong case that the time is ripe for our measurement system to shift emphasis from measuring economic production to measuring people’s well-being. Further it is also suggested that the measures of well-being should be put in a context of sustainability. The commission gave 5 recommendations apart from looking at the well-being spectrum. The five recommendations were: i. when evaluating material well-being, look at income and consumption rather than production, ii. emphasize the household perspective, iii. consider income and consumption jointly with wealth, iv. give more prominence to the distribution of income, consumption and wealth, and, v. broaden income measures to non-market activities.

It was July 19, 2011 when 68 nations joined Bhutan and supported its resolution on ‘Happiness: Towards a holistic approach to development’ for its adoption by the United Nations.  The UN General Assembly adopted this resolution which recognized happiness as a fundamental human goal and emphasized on a more inclusive, equitable and balanced approach to economic growth that promotes happiness and well-being of all. This resolution mandated member nations to take steps towards putting efforts and realizing the vision of a development paradigm integrating economic, social and environmental objectives going beyond GDP based development.

Taking the lead from this resolution, the UN hosted its first high level meeting on 2^nd April 2012 on the theme of ‘Happiness and Well-being – defining a new economic paradigm’. Mr Jigme Y Thinley, the Prime Minister of Bhutan, was the main force behind inviting all concerned stakeholders for discussion in this meeting. This historical meeting was attended by select heads of State, ministers, Nobel laureates, eminent economists, scholars, spiritual and civil society leaders from developing and developed nations.  The UN Secretary General Ban Ki Moon said - We need a new economic paradigm that recognizes the parity between the three pillars of sustainable development. Social, economic and environmental well-being are indivisible. Together they define gross global happiness. On June 28, 2012 all the 193 member states of the UN General Assembly unanimously adopted UN resolution 66/281 and decided to observe 20th March as International Day of Happiness or International Happiness Day.

In the follow up, the Earth Institute brought out the first World Happiness Report (WHR) in 2012 which was edited by renowned Canadian economist, John Helliwell and co-edited by the director of the institute, Jeffry Sachs.  All established happiness scientists got involved in this process which provided an alternate to GDP to compare nations and their progress.  Last week the sixth WHR was published with the support of Ernesto Illy Foundation and the Canadian Institute for Advanced Research. Primarily all these reports have relied on Gallup’s data on happiness based on Gallup World Poll.

In the month of September 2017, the researchers gathered at the Innsbruck University (Management Center, Innsbruck) to disseminate their research on happiness, quality of life and wellbeing under the aegis of ISQOLS. John Helliwell, Richard Layard, Richard Wilkinson, Mariano Rojas, Valerie Moller, Richard Estes, Kenneth Land, Joseph Sirgy etc were all on one page for the cause of happiness and well-being. It was a great opportunity for me to interact with them.

In the era of dominance of market forces and enormous capital flows, focus on happiness and well-being in public policy, can be viewed as a transformational initiative.  Last two decades have produced voluminous literature on the different aspects of happiness and well-being through all kinds of academic and experiential research. Alternative approaches to GDP to measure progress and development are being studied and developed so that next generations are able to view societies from newer perspectives and parameters.

Richard Easterlin perhaps was the first economist who studied the relationship between happiness and economic outcome which culminated into a paradox known as Easterlin Paradox. It states that rise in income does not result in similar rise in happiness. Easterlin paradox came much before Sarkozy report. Similarly in the UK, the New Economic Foundation (which was awarded ISQOLS Award for Betterment of the Human Condition, a decade back, in recognition of their work on development of the Happy Planet Index), started developing HPI looking at life satisfaction, life expectancy and ecological footprints.  Apart from the HPI the NEF also develops national accounts of well-being (as advocated by Daniel Kahneman) which includes the measures of personal, social and emotional well-being. 

Princeton University Press, published ‘The Politics of Happiness - what government can learn from the new research on well-being’ by Derek Bok in 2010.  On the basis of the researches done all across the world, this book makes a strong case for getting the policy makers to prioritize well-being over excessive focus on the market economy. Alex Michalos (known for Canadian index of well-being), categorically mentions ‘The economists messed everything up, the main barrier to getting progress has been that statistical agencies around the world are run by economists and statisticians and they are not people who are comfortable with human beings. The fundamental national measure they employ tells us a good deal about the economy but almost nothing about the specific things in our lives that really matter’. Are we ready for shifting our focus towards well-being from every sense of the term rather than trying it out through the window of economic parameters? This is a major challenge before the state and policy makers.

In 2011, Angus Deaton and Daniel Kahneman concluded through the study of Americans based on Gallup-Healthways Well-Being Index that happiness is result of fulfillment of two psychological states viz., emotional well-being and life evaluation. Purdue University scholars, Andrew Jebb and Loius Tay continued that research and expanded the work on the world data set (1.7 million individuals worldwide) and concluded that globally, satiation occurs at $95,000 for life evaluation and $60,000 to $75,000 for emotional well-being. Nature Human Behaviour published this work in January 2018.

Growth that is merely objective, development that is lopsided, progress that is based on just quantification, may not take us to a better future. It is overdue that happiness is given priority over generally quantifiable measures. Though this noble thought has come from a very small nation, yet it is able to address big issues of mighty nations. It shall be a true tribute on the occasion of International Happiness Day that nations commit themselves for improving quality of life of people and prioritize it over concentration on GDP measures. Human happiness and well-being should be the target of public policy. Around the beginning of this century Polly Toynbee wrote in The Guardian – When God died, GDP took over and economists became the new high priests. That has been the story of the last century. The twenty first century should be the century which should go in the history as an era targeting human well-being and happiness over economic development.