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The Happiness Movement A colloquium paper submitted in partial fulfilment of the Pre Diploma presentation

Faculty Guide

Mr. Pritharshv Pushkar

By

nilay bhandari

Graduating in

March, 2013 (expected) from the MITID

UG Diploma

Discipline

Product Design


Abstract This paper is an attempt to understand how and why the economics of happiness is making its way in mainstream international politics these days through means of diverse indices. It is a factual analysis of some of these indices, a debate on whether they are worth any hype and how good governance can benefit from systems design. Through the paper, i want the readers to partake in the larger self reflection on what is driving our lives today: is money the means and the end? Outline •

Introduction

GDP: concept, lacunae

Happiness economics

Gross National Happiness (GNH), Human Development Index(HDI), Happy Planet Index(HPI)

Is it just hype?

Designwise

Where does the happiness movement stand as of today?

With respect to India

What is the crux?

Conclusion

I remember it as a five mark ‘Differentiate between’ question in economics. Or perhaps a two marks ‘Define the following’ question. But it was always ‘v. imp’ (that is off course shorthand for ‘very important’: a classic, representative of the Indian exam system denoting a topic most likely to find its way in the question papers)! Amidst all those percentage figures and graphs of the economics textbook, those three capital letters in bold glaringly stood out always (yes, i can already imagine typo-enthusiasts nodding). Yes, almost always introduced with its fraternal older twin with a shapely nose: GNP (Gross National Product); Gross Domestic Product [GDP (capital + bold)], is stuff that legends are made of. To economics, it is what the Godfather Trilogy is to movies and Sachin Tendulkar is to cricket. For many years now, the GDP has been the universal index for measuring economic growth and progress of nations. Largely, the GDP is understood as the monetary value of all finished goods and services produced within a country’s borders in a specific


period of time (usually 1 year). It is an indicator of the economic health of a nation that gauges its standard of living.1 GDP has widely come to mean, in the international arena, as the representative of the economic clout of a nation, subsequently representing power (buying and otherwise). The birth of a rock star GDP was born as the brainchild of Simon Kuznets2, an economist at the National Bureau of Economic Research, U.S.A. in 1937. In 1962, following the Bretton Woods Conference that resulted in the establishment of international financial organisations like the World Bank and the International Monetary Fund, GDP became the standard yardstick to measure a nation’s economy. Increasingly, rate of growth of welfare came to be equated with rate of growth of output. Following widespread acceptance of the GDP, Arthur Okun, staff economist for U.S. President John F. Kennedy's Council of Economic Advisers coined the Okun’s Law: For every 3-point rise in GDP, unemployment will fall 1 percentage point. This and other implicit and arguably, simplistic deductions of the basic premise of GDP raised it to an altar in growth measurement. The thumb rule, sort of, became to keep the economy growing, in effect raising GDP, and everything else will be just fine. Subsequently, policy decisions got driven by GDP points. As a result the GDP per capita worldwide was first calculated in 1978 by London based The Economic Journal. GDP has since enjoyed such widespread popularity and acceptance the world over that in 1999, the US Commerce Department declared it as "one of the great inventions of the 20th century." One of the many advantages of such instant success of GDP was its simple methods of calculation excluding any extra effort or investment into data gathering. GDP is measured using three simple methods that in effect result in the same output. These are the income approach, the product approach and the expenditure approach. These three approaches basically work on the simple principle of equating the respective name heads with the total value of products and services at respective junctures of transaction in the market. The three approaches are basically different standpoints for viewing value of products and services in a given financial year. For example, the expenditure approach works on the principle that since all products must be bought, expenditure of the population equals value of total production. How GDP contrasts with GNP is on the basis of scope that the two define. While the former defines scope according to location, the latter defines it on the basis of ownership. GDP scores over GNP, thus due to the ease introduced by its inherent constraints


of framework. [Yes, ‘Differentiate between’ was one of my strengths. :|{No, i wasn’t a nerd}] As a result, GDP found wider audience with nations of the world initially. It wouldn’t be an overstatement to suggest that nations after nations adopted GDP almost in a herd. This is manifest in the fact that the USA opted for GDP over GNP in 1991 as "virtually all other countries have already adopted GDP as their primary measure of production."3 GDP, thus, is an index of a country’s entire economic output — a tally of, among many other things, manufacturers’ shipments, farmers’ harvests, retail sales and construction spending. The conventional feeling about G.D.P. became and is still held that the more it grows, the better a country and its citizens are doing. But something important happened in 2001; the 9/11 attacks in New York led to a plummeting economy. In the subsequent years from 2002 – 2006, while GDP kept rising, personal income fell. Aspersions were cast on the efficiency of GDP; but these questions were hardly being raised for the first time. A failed concert Just years after the introduction of GDP, one of the first to caution against its over and universal use was American economist Moses Abromovitz. In a carefully worded response, that was to turn prophetic many years later, he points out: "We must be highly sceptical of the view that long-term changes in the rate of growth of welfare can be gauged even roughly from changes in the rate of growth of output."4 Then in 1972, in the tiny Himalayan kingdom of Bhutan, upon being crowned King,Jigme Singye Wangchuck declared his aim was not to increase GDP, but GNH: "gross national happiness." Little did the world take notice then, only to wake up to Bhutanese ideals in the twenty first century much later. Such voices proposing alternate methods of national progress measurement rose in number within the first decade of the twenty first century. Others were expressing cautionary notes and viewing GDP with a pinch of salt were many. The primary reason why there was such criticism lashed out at what was once the poster boy for national economic health measurement was that GDP compresses the immensity of a national economy into a single data point of surpassing density. Other specific reasons fell under this umbrella. Chief among them being as follows: • There is a disconnect between actual economic growth, let alone well being of citizens and the framework of GDP. According to Austrian School economist Frank Shoshtak, GDP contributes to naught. For example, if the government were to build a pyramid out of its


whim, it is common sense that it is hardly contributing to welfare of the people. But GDP regards this contribution to economic growth. In reality, however, funds are rather getting diverted from other wealth generating activities. In this sense, GDP mirrors not anything more than monetary pumping in a country. Period. In Shoshtak’s view, “We can thus conclude that the GDP framework is an empty abstraction devoid of any link to the real world. Notwithstanding this, the GDP framework is in big demand by governments and central bank officials since it provides justification for their interference with businesses. It also provides an illusory frame of reference to assess the performance of government officials”5 • In such a sense, GDP is, thus, also conducive to autocratic governing and contradictory to democratic values. • GDP regards divorce, crime and natural disasters as economic growth. Divorce adds millions of rupees through way of lawyer’s fees, crime through the need for security measures and police funding and natural disasters through way of disaster relief funding. In neither case, does the economic health improve but it gets recorded as so just because services are provided! At the same time, it ignores the non market economy of child care, elder care, social volunteer work and other community practices just because no money changes any hands! It fails to recognise that such activities add largely to social progress and well being. • When it got instated, times were different and resources abundant. In the world of today where climate change and natural resource depletion are such pressing issues, it is foolhardiness to continue with development that sacrifices the natural environment or disturbs ecological balance. Yet, GDP entails resource depletion as gain due to creation of wealth and not as depletion of assets. It, thus fails to recognise the cost of economic production. Subsequently, when such environmental pollution activities get recorded as economic gain, the cleanup activities that follow are also categorised as the same. Thus, under the GDP framework, pollution is a double gain activity. This is the reason why the famous Exxon-Valdez oil spill of 1989 in Alaska, USA led to an increase in its GDP. • GDP completely turns a blind eye to income distribution. It hides the fact that rising tide does not lift all boats. This is the primary reason why as aforementioned, between 2002 and 2006, rising US GDP could not account for declining wages. At the same time, GDP blatantly ignores the need to repay foreign debt that temporarily adds to GDP as it results in increased spending. But the burden of incurring debt remains hidden.


• In addition to all this, GDP does not recognise that there is more to citizen’s lives than just monetary gain. Quality of life, quality of time spent, health, and cultural gain are all aspects that never get accounted for. GDP fails to bring to light the larger, philosophical argument that governments must primarily aim at social happiness and well being of which monetary well being is a subset. Yet, the biggest saviour of GDP is the argument that it was never intended to get used the way it is getting used. Pro GDP economists believe it hardly relates to well being and is meant to gauge just national productivity. It is, they believe, being used as a proxy to further development objectives by politicians and leaders. The claim made is that the bullet gets fired by the holder of the gun. Amartya Sen, a Nobel laureate in economics who teaches at Harvard helped create the Human Development Index that debuted in 1990. In a response to The New York Times journalist Jon Gertner, in May 2010 in New York6, Sen described the motivation behind the creation of another index; an argument that captures, in a way, the essence of all motivation behind the creation of all new, subsequent indices of growth measurement. The argument was not one against GDP. In Sen’s own words, “It was an argument against relying only on G.D.P.” As a result, there is another set of believers that say we must be careful about throwing the baby with the bathwater. Even if GDP was to be revised and a newer GDP 2.0 was to be introduced, the polarities and many dimensions of a complex 21st century earth will essentially relegate it to a blinkered view that equates economic growth with progress. For a planet already overburdened with human exploitation and large scale discontent, the answer to repair any such imbalance might be to institutionalise many more indicators that reflect the true complexity of human progress: mental, physical, environmental, spiritual and so on. Even that gets agreed in economic circles with little disagreement. The question everyone’s been trying to answer is how many of such indicators must we look up to: 2? 20? 200? This is the primary reason for the spawning of many such newer approaches to measuring progress. As each corner of the world views progress through the prism of its own economic, social and cultural realities, it attempts at capturing those in the perfect indicator for its own progress and then proposes it to the world. That has been the trend so far in the field of economic growth measurement indices. As a result, we have a whole gamut of indices to choose from but all relatively new and under validation for one to put a finger on. Furthermore, it needs to be seen if any attempts get made by the world community to come together and deliberate over all these


indices and maybe come up with one that is flexible enough for global diversity and objectives and yet robust enough to sustain the major motivations behind its conception.

Head bang Classical music With such a widespread endorsement of the critique of GDP style economic reductionism and the reasoning that economic things matter only so far as they make people happier, the need for alternative indicators of progress and nations’ efforts into devising them led to the dawn of a new field of knowledge, Happiness Economics, in the 20th century. Happiness economics is the quantitative study of happiness, positive and negative affect, wellbeing, quality of life, life satisfaction and related concepts, typically combining economics with other fields such as psychology and sociology. It typically treats such happiness-related measures, rather than wealth, income or profit, as something to be maximized. It aims at introducing feelings to the national accounts and thinks of them as a legitimate objective of policy. The cornerstone of happiness economics is the belief that the state can promote happiness by way of reducing misery, downside risks, ensuring security and responsive public actions. Happiness economics, as a field, has reached such sophistication and maturity in terms of its methods that micro-econometric happiness is given by an equation of well being7. This equation calculates reported well being of an individual at a given time on the basis of known socioeconomic and socio demographic variables and unobserved characteristics. Crosssections of large data samples across nations and time that demonstrate consistent patterns in the determinants of happiness have, in a way, negated the fact that happiness comparisons across cultures aren’t possible. While reported happiness is subjective, a camp of happiness economists believes objective measurement can happen by observing the joy centre of the brain lit up with advanced imaging. Happiness economics raises enough bones of contention with regards to micro economics and individual happiness, the case it presents for macro economics and national happiness is further debatable. The most basic criticism against happiness economics lies in its dependence on the concept of cardinal utility8: personal preferences are measurable and comparable in an objective fashion by an outside observer. Cardinal utility is, however, a discredited and largely discarded concept in traditional economics. At the national level, difficulty rises in accounting for variety and diversity across parameters like age, gender etc. At the next level,


how does one decide how policies get formulated as a response to the outcome? There can be major variations in subjective interpretations of survey findings. Some smell conspiracy and believe happiness research can be used to advance authoritarian aims!! Others have expressed that all it must do is inform individuals, not guide policies. These and other such criticisms raise practical question that happiness economics has already set out to answer. Nevertheless, problems with the measurement can never be sufficient reason to reject the measure itself. If this was to be the case, then we would probably be left with no measure. All measures of well-being, hence, need to be taken with a modicum of scepticism. Where happiness economics scores highly is as an effective means of combining happiness and objective measures to add richness to the evaluation of progress. It adds a human face to the assessment of development and the hitherto dry approaches of statistical macro economics. In tune a) HDI So far, the strongest contender from the happiness economics camp to the hegemony presented by GDP has been the aforementioned Human Development Index (HDI). It is a common cousin of GDP and other happiness indices, albeit closer to the former than the latter. It turns 22 this year. The HDI is a ranking that incorporates a nation’s G.D.P. and two other modifying factors: its citizens’ education, based on adult literacy and school-enrolment data, and its citizens’ health, based on life-expectancy statistics. The HDI even gets the courtesy of the acceptance and the use by the United Nations. HDI came about out of a conversation between Amartya Sen and his Pakistani student Mahbub ul Haq in October 1953. Together they came up with the HDI arguing that GDP was inadequate to capture the complexity of development. HDI distinguishes human development as "very high human development", "high human development", "medium human development", and "low human development" countries. The biggest criticism heaped on HDI is that it takes no explicit account of the relationship between experienced well being and material circumstances in a country; however, assuming the former is completely dictated by the latter. It fails to recognise that the levels of well being in many middle income nations is comparable with those in the affluent West and many of the nations categorised as ‘highly developed’ have mediocre levels of well being.


Thus, other indices have attempted to address this and other anomalies. b) HPI The Happy Planet Index (HPI) is an index of well being and environmental impact that has been formulated by the New Economic Foundation (NEF). NEF is an independent, international charity founded in 1986 by the leaders of the Other Economic Summit (OES)9. The NEF aims at ‘real economic well being’ and has, in the past, forced issues like international debt onto the agendas of G7/G8 summit meetings. The HPI relates human well being to environmental efficiency. It is given as: HPI= Life satisfaction x Life expectancy (Happy Life Years) / Ecological Footprint The HPI represents the average years of happy life produced by a given society, nation or group of nations, per unit area of planetary resources consumed. In other words, it represents the efficiency with which countries convert the earth’s finite resources into the well being of its citizens. It does not claim to crown the happiest nation in the world or the best to live in, neither does it represent the most developed or the most environmentally friendly. What it does claim is the unaccounted effect of ecological footprint on development that HDI does not include. HPI is a departure from all other happiness measures in the sense that it does not equate happiness with life satisfaction. For example, for some married person M spending more time at work than at home, satisfaction might lie at the workplace than with his/her spouse. Perhaps, for M, marital life and domesticity isn’t the bliss that it is made out to be; hence satisfaction comes from working hard. HPI accounts for this spike in reported happiness by listing reported satisfaction. The HPI takes a leap also in the way that it incorporates the effect of development on environmental resources. c) GNH GNH, the current celebrity with the humblest demeanour and the most commanding presence in the world of happiness indices, has caught on quite like a rage with the world. The concept implies that sustainable development should take a holistic approach towards notions of progress and give equal importance to non-economic aspects of wellbeing. According to the Centre for Bhutan Studies that is responsible for all research, survey and analysis into GNH, it is based on the four pillars of good governance, sustainable socio-economic development,


cultural preservation, and environmental conservation. GNH is decomposable by any demographic characteristic and so is designed to create policy incentives for the government, NGOs and businesses of Bhutan to increase GNH. GNH is calculated in nine key domains of psychological wellbeing, health, time use, education, culture, good governance, ecology, community vitality and living standards further subdivided into 72 indicators. Within each domain, the objective indicators are given higher weights while the subjective and self-reported indicators are assigned lower weights. After a preliminary primary survey in December 2007 in 12 districts of Bhutan, the GNH index was formulated, having adjusted shortcomings observed in the pilot on the basis of the methodology of multidimensional poverty by Alkire and Foster (2007)10. The multidimensional poverty measurement focuses individuals as unit of analysis. This was one of the important aspects for considering the measurement as GNH too claims to regard people centred development as the goal of the governance. Detractors of GNH feel it’s just too time consuming! The 2010 survey questionnaire took on an average 3 hours to complete. Many claim it is disconnected with young Bhutan. 24-yearold Princess Yiwang Pindarica, a cousin of Bhutan's King Jigme Khesar Namgyel Wangchuck. Said, "I think they say they are happy because they do not dig deep when they say 'yes. Most youth of my age are confused, they are living each day as it comes, having no idea about GNH, no idea about religion and customs that have been passed on"11Many feel GNH looks like a tourism brochure for Bhutan, professing this idea of a kingdom seeped in bliss and contentment. Ouch! Notwithstanding any opposition, GNH is reaching out far and wide. Bhutan's enormous ambition, centres on inviting world leaders to the Himalayan kingdom in 2014 to adopt a renewed Bretton Woods agreement. More than 600 politicians, economists, academics and spiritual and faith leaders from around the world will be taking part in the UN conference including Secretary-General Ban Ki-moon. Prince Charles is sending a video address. In 2011, the General Assembly adopted a resolution, known as the ‘happiness resolution,’ which noted, that the gross domestic product (GDP) indicator “does not adequately reflect the happiness and well-being of people in a country.”As late as April 2nd, 2012, Bhutan’s Prime Minister the Honourable Jigmi Y. Thinley, hosted Ha High Level Meeting on Wellbeing and Happiness: Defining a New Economic Paradigm at the UN Head Quarters, New York. The outcome of the conference also informed negotiations related to Rio+20, the global


conference on sustainable development being held in June. To date, there have also been G.N.H. conferences in Thailand, Canada, the Netherlands and Brazil.12, 13, 14 At the same time there are many pitfalls that GNH or for that matter, any other happiness index, and its creators, must be aware of. One is its positioning as being against materialism. If it seeks to devalue, demean or ridicule the natural materialist impulse in human aspirations, it is likely to fall flat on its face. A second danger would be if GNH is projected as excessively idealistic, as an alternative way of life meant to unfold only in some ivory tower. The real strength of GNH lies in its understanding of real world needs, emotional and material. This philosophy then, must stand squarely on the firm ground of human pragmatism, and must consciously resist the temptation of becoming an inflexible utopian structure. Further, it must accept that change is inevitable and grow with the newer challenges of this world. At no point, must the concept be over-theorised. Rather it must retain the unalloyed inspiration and vibrant spontaneity of the idea. Any attempt to mechanically measure happiness or to give absolute indicators for this purpose must be resisted; for otherwise there is the danger that the whole concept will be reduced to mechanical statistics, not very different from GDP indicators. Designotes In design terms, inclusion of its citizen’s happiness as a government’s main objective is like a problem statement defined well. In definitions thus far, a lot of streams flowing out of this main objective got precedence while the river itself was turned a blind eye to. So either citizen’s happiness wouldn’t figure in the government’s list of priorities or if it was fortunate enough to, it was thought that of as an implied effect of the government fulfilling all other objectives. Perhaps, this was because it was intangible, the objective of achieving national happiness. But then if the problem brief is intangible, we don’t abandon it. We look for ways into turning the intangibility into real world actions. That is exactly what the Bhutanese government has done when it has formulated the GNH, its indicators, and carried a subsequent survey. That is exactly what the HDI or the HPI attempt at.

To draw an analogy, let me illustrate with a personal example, similar albeit on a micro scale in comparison, how we approached our green design course. We had to design a green school including its space. The clearly defined brief was to have a sustainable philosophy for the school and to ensure that it becomes a way of life for each individual. What we did was


formulate an ideal philosophy, and then break it down into its components. We then broke down the concept of a school into its components of a giver, receiver and the exchange in between. We then checked each component of the school against each component of the philosophy to get to a list of many sub components that got us one step closer to tangibility. This exercise gave us a set of policy interventions. We then saw how the policies could be translated into space such that the two are in conjunction. Similarly, we also mapped what the students did from morning to evening in a school. That gave an important pattern in their behaviour: something we like to term the solid-gaseous behaviour. That led us to the design of the classroom space. Thus, at each step our intention was to convert the intangibles into the tangibles; the ideal into the practicable. In effect, the project turned out well because a systems approach was taken. We began with an ideal which was the compass for the entire design process.

In formulating and adopting the GNH as its indicator of progress, the Bhutanese government has undertaken one of the largest systems design projects. It has systematically had an ideal, and found a set of tangible indicators and now is working towards achieving a high rating on those, in effect achieving its ideal. Thus, i feel the GNH, or for that matter HDI or HPI, are outcomes of a design process with its heart in the right place. It started with identifying the right kind of problem. So the problem statement, if one could hazard a calculated guess, could have been something like: To design an index that measures the holistic well being of the citizens of a nation considering environmental and cultural costs, thus aiding improved policy making by the government. As against this, consider the problem statement (calculated guess, again) for GDP: To design an index that measures the economic progress of a nation

The difference in the two approaches is obvious and understandable when the start points are taken into consideration. The former design brief is bound to result in a better solution than the latter simply because it is far more inclusive, all encompassing and clear. The final solutions can be many and open to scrutiny. But what the former brief guarantees is a process in a certain direction, that results in outcomes justifying the scale of the process. Whether they are a successful model of governance, only time and enough validation can tell. Having an ideal and far reaching masthead to drive the entire process goes a long way in inspiring and motivating the design. That is what, i believe, will happen with the design of governance and its policies when spearheaded by the ideal of happiness indices.


Paid-to-scream fans

To the rational, analytical mind what strikes first about the entire happiness movement in economics is, is it all just too much hype? Personally, i believe there is much remaining to be said from the happiness economists’ side. Foremost being the success rate of happiness indices. Secondly, it also remains to be seen if governments really heed to pointers that are outcomes of happiness surveys; otherwise all of it might turn out to be an exercise in futility. Such and other doubts would always crop up. But i am confident about the happiness movement and i believe it is here to stay. What new concept has ever been accepted with open arms universally? Disruptive innovation must face some initial opposition from cynics, realists, panic mongers and idealists.

The added disadvantage with happiness indices is that they attempt to answer really large questions. But then that is exactly also the reason why they are getting lauded for! The other reason for easy thumbs down is the implementability and logistics, which will directly affect acceptability. But again to an optimistic young mind, that is neither an economist’s nor a politician’s, at best a half baked designer’s, the mere thought that the GNH/HDI/HPI shifts focus and makes heads turn for the bold attempt it is trying to make, is worth championing for.

It’s a little like the global warming/ environment movement/climate change question. Suddenly everyone is talking green, with the alarmists going a step further to shout ‘doomsday’. Then there’s the other spectrum that’s calling it propaganda and conspiracy theory. My point is, if it means that trees will get saved from being cut and new ones will be planted, we have a winner. In the case of the happiness indices, if all it means is that happiness will find reference and mention in policy circles i am game. If it means getting to read front page news with the word ‘happiness’ in it, i am game. What i am really hinting at is the non physical aspect! The whole ring and the sound to Gross National Happiness are so much better and soothing than Gross Domestic Product. Multiply that with every time the acronym GDP gets said, printed, read or written! It might sound simplistic and naive; perhaps it is, but that opinion is driven by a kind of optimism that the newest coke commercial captures so well. For every bad thing in this world, the commercial juxtaposes one good thing that is going on in more numbers! To me GDP inherently represents the


former and the happiness indices the latter, ‘the sunshinewali asha’ (to borrow from the commercial itself)! In this sense, the hoopla around happiness economics is quite justified, rather required and anything but hype! This is apparent when one attempts to fathom how the happiness movement is fast catching up to transition from being the ‘new kid on the block’ to the ‘it’ thing further to normalcy and status quo one-national-head at a time. Perhaps, world leaders are giving in to emotional prosperity and the goodness the happiness indices represent. Perhaps, they are looking to garner more support through such sentimental pandering that makes good copy. Either ways, the happiness movement is getting noticed and making heads, not just turn but stop and question. Quite a reception, one might quip! While believers like me are ‘happy’ at even just this, cynics can choose to disagree but not ignore. Live Orchestra Different quarters of our planet, though, are contributing to the happiness movement in diverse ways. Some might avoid calling it happiness measurement while others are embracing existing happiness indicators with open arms. What one can say with confidence is that the movement is gaining pace.

China created the ‘Green GDP’ in September, 2006. Green GDP monetizes the loss of biodiversity, and accounts for costs caused by climate change. But unfortunately, the scorching pace of Chinese economic growth could never heed to the indicators of the Green GDP. The Green GDP effort collapsed in failure in 2007, when it became clear that the adjustment for environmental damage had reduced the growth rate to politically unacceptable levels. The government withdrew its support for the Green GDP methodology and suppressed the 2005 report, which had been due out in March 2007. For China though, it was half a point scored in dabbling with alternative growth measurement approaches.

The other BRIC nation, Brazil, is under process of adopting the GNH. According to psychologist and educator Susan Andrews, the founder of the Future Vision Ecological Park that will coordinate GNH in Brazil, "GNH seeds are planted in Brazil. Now we have to water it with care." The government is hopeful of assuming larger responsibilities in the world as a nation on the verge of superpower-hood. It believes that it must choose a path of


responsible progress and this, it envisages in GNH as an integrated solution with a systematic approach.

Canada has its own ‘Canadian Index of Well Being (CIW)’. They established a Canadian Index of Well Being Network that came up with the country’s well being index. Canada woke up to the shortcomings of GDP after the 2008 recession. Consequently what ‘well being’ meant was defined as “as the presence of the highest possible quality of life in its full breadth of expression” and a comparison between the Canadian national well being and GDP between 1994 and 2008 was made by the Network. It showed that while GDP increased by 31%, well being dropped by 11%10. Subsequently, the CIW was adopted as a composite index of development with a vision ‘To enable all Canadians to share in the highest wellbeing status....’ At the same time, the CIW makes a conscious effort to distinguish itself as a non-happiness index. The Network explains, “Happiness is a very subjective quality – some people can feel happy in a flood while others may be unhappy in the midst of luxury. It can also be very transient... The CIW mostly collects hard evidence on the status of Canadians' quality of life in various dimensions.”15 These dimensions being good living standards, robust health, a sustainable environment, vital communities, an educated populace, balanced time use, high levels of democratic participation, and access to and participation in leisure and culture. Thus, well being is meant to refer to something much broader than health, as it would be colloquially understood.

The well being movement is spearheaded by Canada’s His Excellency the Right Honourable David Johnston. The CIW finds parallels with Bhutan’s GNH in that both enjoy the backing of the royal heads of the respective countries and both are similar in terms of the pointers that get used for the basis of measurement. Yet both differ as CIW categorically refuses to fall into the category of a happiness index to which the GNH belongs. The CIW Network has also partnered with the Organisation for Economic Co Operation and Development (OECD) to further the cause of progress in tandem with well being; done first in the World Forum in June 2007, in Istanbul, Turkey. CIW and GNH are also congruent on the grounds of how they are getting promoted and publicised by their parent nations to the world community.

The USA has begun the ‘State of the USA’, a system of a dozen new measures now available to the public online in 2010. This is presented in the form of a Key National Indicator System composed of indicators heads like health, economy, safety and security,


crime and justice, aging, families and children, culture, energy, housing and housing. American data under these heads is gathered, collated and represented as visualisations by what is claimed as a non profit, non partisan agency ‘State of the USA’ and the National Academy of Sciences. This data, the average American can access through the agency’s online portal and thus, track progress and keep a tab. The US government has struck a clever chord by refraining from entering into the hassles of any ‘happiness’ intangibles. It has rather chosen to make the statistics visible and let the common man be the judge. This might save the US of any criticism over neglecting to embrace alternative progress indicators after the wide scale debacle of the GDP, especially in its own case. But it is of little value if the data is only visible but the policies whose outcome it is, remain driven by almost failed diktats of myopic consumerism. Thus, the State of the USA is an attempt to present old wine in a new bottle.

British Prime Minister David Cameron believes there must be a departure from dependence on GDP as a measurement of progress. He first floated the idea of a ‘happiness index’ in 2005 while his predecessor Tony Blair was still in office. Blair, incidentally, had an unofficial Department of Happiness even among his close advisers to weigh in the idea of national happiness measurement. Blair unfortunately, had to abandon the vision due to political obligations. With Cameron in office, Britain has a leadership that has pumped about £2mn into the National Well Being Project whose first survey is due in summer 2012. Cameron claims these plans aren’t ‘woolly’; rather they are an attempt to motivate policy by the ideal of well being instead of what is obviously an incomplete and crude, current system. He has received his share of flak for it but his determination seems to have over ridden criticism in this case. Lastly, France has joined the league with growing interest in the GNH with President Nicolas Sarkozy announcing interest in as far back as 2009. Sarkozy asked US economist Joseph Stiglitz, winner of the 2001 Nobel economics prize and Amartya Sen to come up with the new measures France. He believes finance has belied its envisaged objective of being a wealth creator and instead accumulated risks enough to plunge the world into chaos. Referring to the economic crisis the world was in back then, in words that ring with truth for the economic crisis of Europe even today, Sarkozy said, “The crisis doesn't only make us free to imagine other models, another future, another world. It obliges us to do so” The French


Happiness Indicators include Work-Life balance, Traffic congestion, Mood, Chores, Recycling, Gratification, Insecurity, Gender, Tax and Relationships. The world is certainly, in batches, treading the happiness/well being path. A common thread that runs through all the aforementioned indices of growth is that they all hold a tinge of GNH, HDI or HPI. They all seem to be derivatives of these mother indices with permutations of features borrowed from one or the other, to meet the needs and challenges presented by the specific nation in question. Another observation that stands out with this trend is that most countries going this way are those with highly developed economies, hence high GDPs and hence, perhaps the most understanding of its shortcomings. A reformed thief will always know far better than a policeman where to look for clues in a robbery! It is for this reason and for lack of enough validation, that majority of the world nations are in ‘wait-n-watch’ mode over the subject. Concert-voncert So, the happiness movement is yet to reach many parts of the world. But there is an increased openness amongst countries to start looking at GDP in a different light. While there is this start, and even some action on the many lacunae of GDP in many places, the debate seems virtually lacking in India. This is despite the fact that next door neighbour Bhutan has conceived, evolved and operationalised GNH. With China, Brazil, Canada, the US, the UK and France, all beginning to charter the hitherto neglected territory of alternative progress indices. Such widespread, growing world interest in the quest for a better index of growth measurement is overwhelming in the least, but largely it is symptomatic of the urge to perfect the flawed, existing system. It is an acknowledgement of the flaws in the first place! The quest is two pronged: to find a better, all inclusive index or to find one that can account for all that the present index (GDP) cannot, but in combination. The debate has never been on abandoning the GDP altogether, at least not initially. But increasingly we are getting solutions like the aforementioned ‘Green GDP’ that have attempted to build on the existing framework in an attempt to account for wider factors that influence growth.

India, though, remains largely nowhere to be found in this reflection. It has diplomatic, cultural or economic ties with all these nations studying and deliberating over the subject. But, it remains un-stimulated. Blind application is off course not what is implied here. It is the responsibility of the government to at least participate and further contribute towards this


all important discussion so that an analysis on how such an index can be made India centric and India specific, is done. The fact that the administration seems oblivious and absent in this scene is abominable. This is majorly, for two reasons: one, it defines how the government views growth at present; two, in the long run, it is to define how policies shape up in this country. In that sense, this government has a responsibility to all the future ones to take office. Most importantly, for a country that is home to over 17% of the world’s population, it is imperative that it invests time, energy, effort and capital in measuring if its people are part of the growth story that it envisages for them. The well being of its people is of paramount importance to any government; it assumes astronomical significance when the number in question is more than a billion.

The saving grace comes from the state of Assam, where India’s first gross state happiness index will be undertaken this year. It will be carried out by the Centre of Environment, IIT (Guwahati) in collaboration with the School of the Environment, Flinders University in South Australia and supported by the United Nations Development Programme (UNDP) and the Assam government. The survey will be initiated on the model of the Bhutan Gross National Happiness (BGNH). A pilot survey of two or three months will be followed by a main survey comprising of all districts of the state. A workshop titled 'A Stakeholder Workshop on Measuring Sustainable Well-being for Assam' held at IIT-Guwahati on the 31st January this year to discuss the plans of the survey. Udoy Sankar Sakia, Associate Director, Applied Population Studies School of the Environment Geography, Population and Environmental Management, Flinders University, a participant of the workshop explains, "The chief minister was impressed by the GNH carried out in Bhutan last year and he had shown some interest in the same being carried out in Assam. And it was then that we decided to carry out the survey here. The concept of the well-being survey was introduced by the UNDP. The Human Development Index is a yardstick measuring human well-being in terms of health, education and income. But what we want to do in Assam is beyond these three aspects�16 What gets outlined here is readiness and positivity of attitude displayed by an administration at its topmost rank. That is most heart warming about the entire Assam story! Then there are these efforts the Bhutanese government is taking from its own side to promote the concept of GNH among the leaders and thinkers of the world. In the October of 2010, a


symposium titled the ‘Pursuit of Happiness’ was organised by the Royal Government of Bhutan to spark a discussion on national well being in conjunction with India. Participants included luminaries from both countries with Pavan K. Varma, currently Ambassador of India to Bhutan, posing ‘The Problem’ as part of his address. Focussing more on the solution, Varma believes the world is looking for a new ideology which can combine economic growth with personal well-being. GNH is that new idea, occupying the middle ground between the polarities of capitalism and communism, and providing a mutual agreement between the excesses of both. The participants included Prime Minister of Bhutan Jigmi Y. Thinley, A.K. Shiva Kumar, development economist; Member, National Advisory Council, Delhi, Karma Ura, President, The Centre for Bhutan Studies, Thimphu amongst others. Thus, there seems to be some level of engagement between the governments of both nations; particularly from India’s side, one might concede that there is a start, albeit for diplomacy sake. But the dialogue seems to have ended at cordial exchanges; or perhaps this is pregnant pause! The Assam example is a one of; meanwhile the national political will seems blissfully caught up with the goings on of everyday upheavals to heed to long term policy ideas like the GNH. Bhutan and Assam: it is something about the hills maybe!! Parallely, some sections of the Indian media seem to have woken up to the happiness movement and have presented their versions of the story. This is a welcome change, although it is more in the form of reportage than editorials or opinions. In an article in the Times of India of May 2004, representing early euphoria and wonder over the concept of happiness economics in general and GNH in particular, the copy goes as, “The term "Gross National Happiness" or GNH evokes smiles, laughter and occasionally a questioning frown.”17 Towards the end, the article takes on a cautionary note: “Economists burdened with running the world-as-it-is dismiss the concept as utopian. They baulk at the induction of spiritual and moral concerns in economic policy” As the movement gains momentum, with the GNH leading the front among all happiness indicators, at least in India, the Indian reaction is still mixed and yet to crystallise into any focused homogeneous interpretation. Anirban Kar, associate professor of economics at the Delhi School of Economics, says a happiness index is not of primary importance to India because we do not even have reliable data on the condition of rural primary schools, primary health centres, land use, land ownership etc. “If the government is really serious, then it should prioritize collection of such data rather than indulging in GNH computation."On the


other hand, psychoanalyst and writer Sudhir Kakar says a happiness index will do India good, although he admits the difficulty would be to reach a consensus, not on the constituents of happiness but on the weightage to be given to each constituent. Providing the middle ground perspective is Sugata Marjit, director of the Kolkata-based Centre for Studies in Social Sciences, who believes that measuring happiness can be a complex matter, more so in India. "A person with little access to health and education can feel happy for completely different reasons. Often, there are elements which people value a lot and economists do not," he says. Representing the voice of dissent, Arvind Panagariya, professor of economics at Columbia University, points out that happiness tends to fluctuate too. "I can add your rupees and mine to arrive at our total income together," says Panagariya, to illustrate the point. "But, I am not sure how I add your and my happiness to get at our total happiness together.” The up side is that diverse views are getting expressed over the issue. The downside is that these aren’t enough to represent the collective argumentative tradition of our country that Amartya Sen celebrates in his Nobel Prize winning novel ‘The Argumentative Indian’. However, what one can gather definitely from the little debate that has taken place in our nation is that Indians are a sceptical lot. Perhaps, our complete agreement to the concept of happiness economics might come once it gets packaged as an idea that the west is sure about. As has been true in the case of so many of our own legacies, foreign acceptance plays an important role in convincing us. Yoga is a strong case in point. GNH, as a representative of the happiness movement in India, can be traced back to Buddhist values very much part of the Indian ethos. Yet, it might take us some time to fathom that reality and embrace the concept. At the same time, the cautions raised about happiness indicators with respect to India are not based on hollow grounds. For the diversity and polarity that India represents, whichever be the happiness indicator, if and when we choose to adopt, will have to be tweaked to accommodate Indian quirks and digressions. Ground logistics will be another major hurdle that will have to be considered. Our large population and its irregular distribution will present its own share of challenges. For a largely rural populace that is far too depressed and discontent with farmer suicides, corruption, political betrayal, load shedding, Naxalites and other problems that tread simultaneously with the Indian growth story of 7.9%, it will be difficult, perhaps even insulting, to begin talk about happiness economics. These aren’t the same problems as those of the India of yesterday; we have risen above roti, kapda, makan, sadak, bijli to enter into a complex space where general aspiration is mired in large inequality


of wealth distribution. Day by day, India is tending more towards a capitalistic, free market, consumerist culture and beginning to value it and struggle for it. We aren’t as spiritual as we were some years back and our gods are beginning to appear on Brazilian bikinis. There is news about a mall opening up in the small village of Loni-Kalbhor, 23 kms on the outskirts of the western educational hub of Pune city. Loni already has two major educational campuses to result in a total of 6 colleges in the village. Even Cafe coffee day opened an outlet in Loni to cater to the largely middle and upper middle class family students that attend these boarding colleges charging fees in lakhs. This is the reality of our villages today. Our villages are increasingly shedding their sleepy and dusty skins to don a new, semi-urban attire. In the urban landscape, we are beginning more and more to define our success by the pay package MNCs are offering us. Urban India is a model of western concept of growth with its glass facade buildings and umpteen brands shouting out at you for 2 seconds of your attention. In an India that is increasingly valuing material expansion, the biggest challenge will be to convince people of the paradigm shift that happiness indicators offer and represent. Albeit challenges like these and others, India finds resonance in stories of countries like Brazil. The similarities in terms of scale, diversity, development and demand are many between the two countries. But Brazil seems to have taken a head start in grabbing the bull by its horn and deciding not to go the China way in terms of development. As a result, the nation got interested in the GNH and has been a regular at the International GNH conference until 2008, even hosting the 5th conference in the subsequent year. There is a lesson for India to learn in the Brazilian example. There is no reason why they can attempt to manage a mention of happiness in the way they progress and their citizens grow, and we cannot. Crescendo The crux of this whole exercise: what drew me to this? I was most fascinated by the fact that someone somewhere could think of introducing something as fundamental as happiness within the framework of everyday governance. In what is mostly understood as murky and not-for-me world of politics, an attempt to bring some amount of idealism is in itself a breath of fresh air. For the longest time now, the field of governance has been left bereft of any breakthrough innovations. In my view, happiness economics brings in a new perspective and a new mindset to the table. A mindset and an approach that is a strong departure from an entire society whose single minded aim, personal and collective, through all its efforts is the generation of money. As crude as it may sound, that’s what we have come down to:


we would like to believe we have higher motives but through a calculated conditioning of generations after generations, our society’s purpose has been debased.

This is most symbolised in the stronghold that private corporations have established over decades now, spreading their tentacles as far up in the highest echelons of international power to the extent that governance, policies and amendments get twisted to suit their objectives. They are beginning to represent a nationality of their own, with a single point agenda of acquisition and control, so emblematic of that greed to generate more and profit from it. The fountainhead of it all being the monetary system. This finds reference in the 2008 documentary Zeitgeist Addendum produced by independent filmmaker and social activist Peter Joseph. In the documentary, Roxanne Meadows, architect and collaborator with designer Jacques Fresco on the Venus project18, points out,“The monetary system has become so distorted that the concerns of the people are really secondary, if they're there at all” While the documentary smells large scale conspiracy theory permeating every walk of life (which is debatable and best left to a discussion on some other platform), where it scores convincingly is on the fact that money gets overemphasised in our world. The documentary goes deeper into the subject and makes one question, convincingly so, at what is the glaring reality of our lives today. All our actions and ambitions are anchored in monetary wealth. GDP, then, is part of the mechanism that keeps the machinery of money going. By measuring economic gain, it is basically saying economics is all that matters. Since economics matters, personal wealth matters. Since personal wealth is of importance to the state, individuals want to expand monetarily. Since the individual is interested in only money, the state claims that is what it must care for. In effect that is what it must measure! It is a cycle. One, which can be broken by removing or tweaking any one of its stages. The easiest is at the stage where measuring happens. Should it matter, what gets measured? What matters, should get measured. ‘Coz how would you know it is blood pressure if all you were measuring was temperature. What happiness economics and its many indices do is shift focus. It is basically saying we’ll measure other stuff too! We won’t stop at money. That implies dethroning the monetary eminence off its centre stage and having other factors share spotlight. So by further implication, it is offering a step towards an improved society that values well being far more.


In that sense, what we are looking at through means of happiness economics is a chance at a different future. Different because it will be too early to call it better. For all these years, that GDP and what it represents, the monetary system, have been in operation, there has been more trouble caused than good done. In my view then, it is time GNH/HDI/HPI or some other holistic index, and what it represents, the economics of happiness, are given a chance in the hope of a potential eureka moment. It is a world that revolves around the generation, consumption and transmission of money. It is a world that kills, slaughters, goes to war and inflicts pain for money. It is a world whose hunger, thirst and rest are money. Whatever happened to food, water and sleep? It is a world that packages, markets and sells emotions, relations, feelings and desires. It is a world that is more manmade and far removed from the natural world than ever before. It is a world that is not an ecosystem but one that believes in feeding off its own member elements. It’s a dog eat dog world that is enticed and runs behind one bone and one bone only: money. It came into being so that it could save us a lot of inconvenience. It came into being so that there could be an order to societal structures and transactions. Slowly from being the vehicle, it has transformed into the driver that all of us are chasing. Slowly from being the means, it is now an end in itself, rather the only end. We have seen many long standing societal institutions like family, marriage, parenthood, suffer collapse and scepticism to make way for more money friendly concepts like pre nuptial agreements and what not. Slowly money has made inroads into all walks of life to attain the status of the single most essential for life after natural essentials. But it has failed. In all that it was meant to serve, money has far exceeded its micro envisaged goal and turned into a Frankenstein. What is sadder though, is how few of us are even conscious enough to acknowledge this. For, the machinery of money has made us all into cogs that keep it going as we keep going about our lives mechanically. For those few who don’t want to be party to this, the machinery leaves little scope for any parallel existence; in effect, enslaving all into the bonded labour of ‘earning’ By and large the monster that money has become is going on just for lack of a better alternative and a transformative vision that aspires large scale global change in thought, outlook and understanding of life. We need to bring back to focus the idea that there’s more to life than just money, that it is just a by product, just a means. This is where Happiness


Economics steps in. It has the potential for large scale systemic shift in ideology. It is about time, responsible development in the 21st century at the governmental level gets driven through the things that actually matter than by green notes that we have been taught to venerate and attach false glorification to. Otherwise how else are we to remove all the importance we lay on money? Only through measuring what really matters to a fuller, richer, more meaningful life in tandem with the ways of nature; and relegating fake, meaningless pieces of paper to the tertiary importance they deserve. Coming back to the Zeitgeist Addendum, John Perkins, in the documentary sums up for me, why this entire exercise and exploration into the happiness movement was so fascinating. He explains how we must consider this entire world as our community inclusive of plants, animals and the elements and consequently further our care with that in the mind... ‘connectedness’, he calls it. The Bhutan government echoes this sentiment when it claims its idea of happiness "has nothing to do with the common use of that word to denote an ephemeral, passing mood – happy today or unhappy tomorrow due to some temporary external condition like praise or blame, gain or loss. Rather, it refers to the deep, abiding happiness that comes from living life in full harmony with the natural world, with our communities and fellow beings, and with our culture and spiritual heritage, – in short from feeling totally connected with our world” Diminuendo The growth index acts pretty much like a vantage point that allows growth to be viewed, compared, directed and cross checked across time and space. In that sense, it is the lighthouse that guides government decision making. From this standpoint, it matters how and where we choose to build the lighthouse in the hierarchy of needs. Do we build it at the relatively attainable bottom and wait in hope that all higher needs will get satisfied? Or do we build it at the idealistic top that is difficult to surmount but once achieved can ensure an all encompassing and inclusive growth story? Do we shy away from the ascent just because in our conditioned minds the ideal of a collectively happy and content society is a mirage? Or do we aim for the stars in the hope that we will at least reach the moon? These are questions governments should be interested in. These are questions governments must not relegate to philosophy. These are question, that i am sure, have solutions. The solutions might lie at the end of a well managed design process with systems thinking at its heart. But that again is a


very lofty claim that i must make in all humility. And then again, we all know how design process is often cyclic!! ;) Endnotes 1: www.investopedia.com 2, 4: Foreign Policy Magazine, Jan-Feb 2011 issue, GDP: A brief History by Elizabeth Dickinson 3: Gross Domestic Product as a Measure of U.S. Production, August 1991, U.S. Bureau of Economic Analysis. 5: The Mises Daily, Thursday, August 23, 2001, The Mises Institute, a world centre of the Austrian School of Economics and Libertarian, Political and Social theory (mises.org/daily/770) 6: The New York Times magazine, May 16, 2010, The Rise and Fall of GDP by Jon Gertner (www.nytimes.com) 7: Wit=α + βxit +єit where W= reported well being, i= individual, t= at time, x= a vector of known variables, which include socio-demographic and socioeconomic characteristics, єit= error term to adjust for unobserved characteristics and measurement errors The Economics of Happiness, Carol Graham, Economic Studies Program, The Brookings Institution 8: en.wikipedia.org/wiki/Cardinal_utility 9: The unHappy Planet Index by the New Economic Foundation 10:Sabina-Alkire Method, Centre for Bhutan Studies. 11: Huffington Post, May 21, 2012, Bhutan Happiness Index: Buddhist Country Fails On Its 'Gross National Happiness' (GNH) by Vishal Arora 12: www.cabinet.gov.bt , Address by the Hon’ble Prime Minister on Well Being and Happiness at the UN Head Quarters, New York, April 3, 2012 13: www.un.org, U.N. News Centre, Newsmakers: Prime Minister Jigmi Y. Thinley, April 2nd, 2012


14: The New York Times, Opinion Pages, March 28, 2012, The U.N. Happiness Project By Timothy Ryback 15: Canadian Index of Wellbeing. (2011). How are Canadians Really Doing? Highlights: Canadian Index of Wellbeing 1.0. Waterloo, ON: Canadian Index of Wellbeing and University of Waterloo, October 2011 16: The Times of India, January 2, 2012, Guwahati, pilot-survey-assam-gross-nationalhappiness 17: The Times of India, March 3, 2004, (edit-page) jigme-singye-wangchuck-thimphu-grossnational-happiness 18: thevenusproject.com/en/jacque-fresco/roxanne-meadows

Bibliography Papers 1. A Non Technical Introduction to the Economics of Happiness by Andy Warwick, December, 1999 2. GNH Survey Findings 2010, Centre for Bhutan Studies, 2010 3. The Second Gross National Happiness Survey Questionnaire, Centre for Bhutan Studies, April 2010 4. Happiness and Future of Asia, Karma Ura Videos 1. The Happy Planet Index, a TED talk by Nic Marks 2. Why are We happy, a TED talk by Dan Gilbert Web References 1. www.theeconomicsofhappiness.org 2. www.indiaseminar.com 3. www.grossnationalhappiness.com


The Happiness Movement