The measurement framework is now a model for governments everywhere

This year, the administration of US President Joe Biden announced that it will—for the first time in that country’s history—seek to look beyond traditional measurements of Gross Domestic Product (GDP), exploring how to measure and report on the health of nature as part of the nation’s balance sheets. 

It was a bold and historic announcement that was the culmination of decades of research and advocacy from experts and activists, who have cited the limitations of GDP as a measure of national progress and human well-being.  

Yet the move wasn’t entirely unprecedented.  The United States is now following in the footsteps of another country that’s been investing in holistic national accounting for decades: The Kingdom of Bhutan. 

It’s now been more than half a century since King Jigme Singye Wangchuck officially decided to prioritise Gross National Happiness (GNH) above GDP and invest in its development as a framework for national accounting.  Around the world, the wisdom in this approach has become increasingly clear. 

The COVID-19 pandemic underscored that human well-being depends on factors that don’t always directly relate to economic growth—including mental health, meaningful vocations, and opportunities for social connection.  GNH has long accounted for such factors.  

While GDP is effective in its official purpose of measuring near-term industrial output, challenges like climate change, inequality, and social isolation reveal why it’s a flawed indicator of a society’s overall progress.  Simon Kuznets, the economist who guided the creation of GDP, wrote later in his career that “the welfare of a nation can scarcely be inferred from a measurement of national income.”  

To date, GNH hasn’t just been a statement of principles.  It’s had substantial impacts on policymaking.   Bhutan’s status as the world’s first carbon-negative country is the result of deliberate conservation decisions that GNH has reinforced. The country experienced significant improvement in factors underlying GNH in the period of 2015 to 2022, including through the pandemic, in large part because His Majesty the King and the Royal Government of Bhutan actively prioritised volunteerism, public health precautions to reduce risks, and support to unemployed people.  The emphasis on human well-being over aggregate economic growth has resulted in decisions to bolster social and ecological protections.

The 2022 GNH Index findings also show that while income matters, it’s not a fast track to multidimensional well-being. Looking at the richest 20 percent of Bhutanese in monetary terms, one might expect them to be deeply or extensively happy by the GNH index (as 48.1 percent of the population are).  However, 2 out of 5 people in the richest group (41%) are not. Yet looking at the income poorest 20 percent of Bhutanese, 3 out of 10 do indeed manage to be deeply or extensively happy.  By broadening the view, the GNH Index describes a wider horizon – for the income poor and rich alike.

Today, amid serious challenges to the economy—including high-unemployment, a tourism sector that hasn’t recovered from pandemic losses, and a substantial outmigration of working age people to Australia and other job markets—there could be growing pressure to abandon a focus on GNH and instead embark on a plan for maximizing expansion of GDP.  As the thinking goes: Focus on the fundamentals of economic growth, and the conditions for happiness will automatically follow. 

This would be a mistake.  

Turning focus to GDP alone won’t guarantee successful growth.  Since the inception of GDP as a standard for national accounting nearly a century ago, scores of countries and agencies have made the maximization of economic growth the overriding aim of policymaking—and nonetheless suffered lacklustre or even negative growth.  In prioritizing near-term GDP growth above all else, a government often side-lines long-term priorities like education, mental health, community connectedness, culture, and environmental sustainability—suffering serious human and ecological costs that don’t appear on a traditional financial balance sheet.  

This is why countries including the US as well as Germany, France, and the United Kingdom have been working to develop more comprehensive national indicators along the lines of GNH.  Many countries are likely to follow. Yet for many developing countries, economic growth is also much-needed – especially post-pandemic. So will Bhutan take its wisdom to a new level in this generation, and chart a path of Economic Growth alongside GNH Growth?  Will the products driving growth be green, culturally and digitally imaginative, built by fairly paid workers in meaningful jobs who are personally flourishing, with fair and strong institutions, peace and good governance?  This would not be a mistake. It would be a gift.  Even more countries would follow – with great gratitude. 

Over the long run, GNH will be vindicated as wise economics.  We’re only just beginning to understand the financial costs of unchecked crises from social isolation to climate change to biodiversity loss.  To people around the world, Gross National Happiness is regarded as a distinctive element of Bhutan’s national character—and it will likely serve as a long-run source of interest that results in foreign direct investment and other economic dynamism.

More importantly, GNH will be vindicated as wise in terms of values.  Bhutan embarked on an act of radical imagination that’s inspired the world.  By staying committed to GNH – and building on it to meet the need of the hour, Bhutan will continue to serve as a wise guide and an respected example for nations—large and small—for years to come.

Contributed by 

Kim Samuel 

(founder of the Samuel Centre for Social Connectedness and author of On Belonging: Finding Connection in an Age of Isolation. She is a visiting research fellow at Green Templeton College, University of Oxford )