In Bhutan, progress is measured by how happy people are, not how much wealth people have.

IMAGE Bhutanese king Jigme Khesar Namgyel Wangchuck voluntarily ceded much of his power in order to transition the country to democracy [GALLO/GETTY]

I recently returned from a trip to Bhutan, a small Himalayan county where their enlightened former king declared that the goal of his country's policy was 'Gross National Happiness' (GNH) rather than 'Gross Domestic Product' (GDP).

I say 'former king' for two reasons. The first is because he passed the crown on to his son. The second is because neither he nor his heir now govern as absolute monarchs. In what must be the first time in recorded history, the king had to convince his subjects (in the face of real opposition) that democracy was a better way. After a very interesting and unique transition, Bhutan is now a constitutional monarchy - much like the United Kingdom - where the king has mainly ceremonial duties.

The new Prime Minister, Lyonchoen Jigme Y Thinley, and the elected government have set up a 'Gross National Happiness Commission' (GNHC) to implement the process of both measuring GNH and ensuring that the country's policies are aimed at improving it. They have undertaken surveys of GNH and developed a GNH policy screen. National policies include the goal to become the first country to produce only organic food, and to be a net carbon dioxide sink in perpetuity.

Why are the Bhutanese not getting on the bandwagon that GDP growth is the solution to all problems? They recognise that while traditional economic growth has in the past been a major means to improving social well-being, it is now causing at least as many problems as it solves. It is not sustainable because it is pushing us beyond the planet's environmentally safe operating space. It is also not always desirable because it only contributes to improved well-being up to a point. We need a new approach to economic progress that takes into account the hidden costs of traditional growth, on jobs, on families, on society, on nature, and ultimately on our happiness and quality of life and its sustainability.

GDP is the total market value of all final goods and services produced in a country in a given period. But GDP was never intended as a measure of well-being or progress. It only measures national income or activity and it includes only those goods and services traded for money. It also adds everything together, without differentiating between desirable, well-being-enhancing economic activity and undesirable, well-being-reducing activity.

An oil spill, for example, increases GDP because someone has to clean it up, but it obviously detracts from well-being. More crime, more sickness, more war, more pollution, more fires, storms and pestilence are all potentially positives for GDP because they can cause an increase in economic activity. GDP also takes no account of how the national income is distributed among people, ignoring the fact that a dollar's worth of income produces more well-being for a poor person than a rich one.

Alternative measures of progress, like the Genuine Progress Indicator (GPI), adjust for these problems with GDP to arrive at a better approximation of 'national well-being'. Results show that while the US GDP has steadily increased since 1950 (with the occasional recession), GPI peaked around 1975 and has been relatively flat or declining ever since.

So what do the Bhutanese mean by GNH? Bhutan recently completed a survey of 8,000 of its citizens, asking them over 200 questions about various aspects of their lives and how satisfied they are with them. It is what social scientists call an assessment of 'subjective well-being', or SWB - an area of research that is getting increasing attention in many quarters of science and policy as part of the emerging 'science of happiness'. In the US, for example, SWB surveys show flat or dropping scores over the last several decades, consistent with the flattening GPI estimates.

But the GNHC and others in Bhutan recognise that there are other, more objective elements that are also important in assessing their country's overall well-being. Our team was brought in to help incorporate 'natural capital' and the ecosystem services it provides into their national accounting framework.

Ecosystem services are the often un-accounted for benefits that people derive from nature - clean air, water, and soil, a stable climate, recreational and spiritual opportunities to connect with nature, and many more. We estimated in a previous study that, on a global basis, these services were worth in aggregate more than all of global GNP combined.

But these services do not yet adequately appear in any country's national accounts. Bhutan sees itself as a leader in rectifying this situation. We held a workshop there last March with over 40 representatives from several government agencies, universities and others to assess how best to do this. We plan to hold a series of follow-up workshops involving students and faculty from the US working with the Bhutanese to help them become a model of sustainable well-being and to help us do the same.

We all have a lot to learn from Bhutan. They are a small county not yet addicted to economic growth in the conventional sense. They can step back and ask the really important questions: What is happiness? How do we best pursue it? How does one person's happiness depend on everyone else's? How important is nature to our happiness and its sustainability? How much and what types of material consumption do we really need to be happy?

The founders of the United States also asked themselves many of these same questions. They set up a country devoted to 'life, liberty and the pursuit of happiness'. Bhutan is helping us to better understand the interdependence of all life on earth, the responsibilities that come with individual liberty, and the meaning and measure of happiness. These are issues we will all have to collaboratively grapple with and better understand if we hope to create a world where humanity can flourish and be happy within the finite boundaries of the amazing planet we inhabit.

Robert Costanza is a Professor of Sustainability and the Director for the Institute for Sustainable Solutions (ISS) at Portland State University.

The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.

Source: Al Jazeera