Milan Thomas, an ADB economist who specializes in social sector impact evaluation, and Yangchen C. Rinzin, a research fellow at the Centre for Bhutan and Gross National Happiness Studies, answer questions about the use of Bhutan’s Gross National Happiness index.
Bhutan is a small, landlocked kingdom with an outsized profile on the global stage due to its unique development philosophy. The country has a centuries-long history of viewing happiness as a core responsibility of government. The Gross National Happiness (GNH) Index was formally adopted as a development indicator in Bhutan’s 2008 Constitution and up until last year, Bhutan’s tourism slogan was “Happiness is a Place.” March 20 is International Day of Happiness, a global celebration of happiness organized by the United Nations.
What is the Gross National Happiness Index?
Fundamentally, the Gross National Happiness Index is a multi-dimensional poverty index – it aggregates Bhutan’s performance across nine domains and 33 development indicators into a single number.
Bhutan measures happiness by periodically surveying about 10% of the population and compiling statistics that fall under nine domains: living standards, health, education, environment, community, time-use, psychological well-being, governance, and culture. Under each domain, there are several indicators. For example, the living standards domain is comprised of income, asset ownership, and housing. None of the 33 indicators measure happiness directly (although an indicator under the psychological well-being domain based on the Gross National Happiness survey questions about life satisfaction comes close to some definitions of happiness). Rather, the nine domains were determined by the 2007 government commission that designed the index and seen as capturing enabling factors for happiness.
For each of the 33 indicators, there is a cut-off for determining whether an individual has reached a sufficient level. For example, sleep sufficiency is set at 8 hours per day. Indicators within a domain are weighted to determine sufficiency for the domain as a whole, and a surveyed individual is deemed happy if they achieve sufficiency in at least six of the nine domains. This individual-level information is then transformed into a single measure for the population: the Gross National Happiness Index. The index ranges from 0 (if all surveyed individuals have insufficient achievement in all nine domains) and 1 (if all surveyed individuals have sufficient achievement in all nine domains).
How is the Gross National Happiness Index related to Gross Domestic Product (GDP)?
The Gross National Happiness approach that Bhutan formally adopted in 2008 was trailblazing in that it provided the world with proof-of-concept for moving beyond GDP measurement and taking a holistic view of social development. Many of the principles underlying the Gross National Happiness Index are founded in the tenets of Vajrayana Buddhism (the state religion of Bhutan), and there is still room for debate on the included domains, the chosen indicators for each domain, and the sufficiency thresholds for each indicator. Other countries have constructed their own versions of happiness indices, reflecting different visions for what socioeconomic development means and the constantly progressing scientific understanding of the determinants of happiness.
Is Bhutan becoming a happier place?
When the first Gross National Happiness survey was conducted in 2008, the Index was 0.73. The Index rose to 0.74 in 2010 and to 0.76 in 2015. The planned 2021 survey was delayed by the COVID-19 pandemic, so an updated Gross National Happiness Index is unavailable, and it cannot be said with certainty whether the upward trend in happiness has continued over the past seven years.
However, the latest Bhutan Living Standards Survey (conducted in 2022) contains several indicators that suggest Bhutan continued to build enabling factors for happiness from 2017 to 2022. For instance, home ownership (a key indicator under the living standards domain) increased from 57% in 2017 to 58% in 2022 despite the economic hardship wrought by COVID-19 disruptions. The rate of health service access (a key indicator under the health domain) for those who suffered illness or injury increased from 72% in 2017 to 91% in 2022. Social safety net programs, such as cash transfers through the King’s emergency income support program, were likely instrumental for ensuring such social indicators did not slide during the pandemic.
