GDP AND GNH

GDP and GNH

GDP and GNH

GDP

Gross Domestic Product (GDP) is the broadest quantitative measure of a nation's total economic activity. More specifically, GDP represents the monetary value of all goods and services produced within a nation's geographic borders over a specified period of time (James, 1997).

Equation

GDP = Consumption + Government Expenditures + Investment + Exports - Imports

Components

Consumption

Durable goods (items expected to last more than three years)

Nondurable goods (food and clothing)

Services

Government Expenditures:

Defense

Roads

Schools

Investment Spending

Nonresidential (spending on plants and equipment), Residential (single-family and multi family homes)

Business inventories

Net Exports

Exports are added to GDP

Imports are deducted from GDP

Gross National Happiness (GNH)

Several decades ago the reigning monarch decided to focus efforts of the country not on increasing its Gross Domestic Product (GDP), but rather Gross National Happiness (GNH). It's a rather profound shift, one that is informed by the realization that generating economic wealth doesn't necessarily equate to greater individual well-being. Rather a range of factors should be considered, perhaps best illustrated by the survey associated with Sustainable Seattle's “Happiness Initiative”. Next year, Great Britain will also start incorporating such questions into their annual integrated Household Survey (Holmes, 2010).

Redefining value is fundamental to the pursuit of greater sustainability and, I would argue, to personal fulfillment. So often focused on “saving the planet,” we too easily overlook the goal of creating more vibrant and resilient lives. When I recall my truly happy memories, while often enabled by economic factors, the experiences themselves had nothing to do with money, and everything to do with the people, place, activity and occasion. I'd propose that “happy” people are better employees, family members, neighbors and citizens. Yet too often we overlook the conditions that contribute to our well-being, outside of what is going into (or out of) our bank accounts. Ascertaining a more holistic metric is a good start. How we begin to understand and act on those numbers, of course, will be the true measure of our intentions.

Measurement of Happiness

Bhutan has attempted to do that with its entire country. In 1972, Bhutan's then leader, King Jigme Singye Wangchuck, coined the phrase “Gross National Happiness”. Since that time the Center for Bhutan Studies has developed a sophisticated survey instrument to measure its socio-economic prosperity, essentially organizing its national agenda around the basic tenets of Buddhism (Karma, 2008).

Jonathan Harris decided to find another tool to measure the happiness of the people of Bhutan. He would use balloons. In 2007, he spent two weeks in the country interviewing 117 people asking them various questions about their level of happiness: What makes them happy; what is their happiest memory; what is their favorite joke; what is their happiness level on a scale of 1 to 10; if they could make one wish, what would that be. He then gave each person the number of balloons that corresponded to their happiness level and wrote each person's wish on a balloon of their favorite color. He saved all of those balloons, re-inflated them, and hung them up at Dochula, a sacred mountain pass at 10,000 feet where there are thousands of prayer flags that ...