Gross National Happiness (GNH): Practicing the Philosophy

This article is an excerpt from the research project titled “Privatisation in Bhutan, Theory and Practice” undertaken by the author. The research study has not been published as yet.

Bhutan has made an explicit adoption of “Gross National Happiness (GNH)” as its development philosophy. The development of the country is to be guided by this philosophy. Although the actual articulation of the philosophy was made in the 1980s, according to Stefan Priesner this unique development concept evolved from the country’s unique socio economic, historic and political circumstances.

He labels the GNH as one of the “last truly indigenous development approaches”.“….the approach (GNH) is not an intellectual construct detached from practical experience, but rather the translation of a cultural and social consciousness into development priorities. Thus the concept of Gross National Happiness has organically evolved from the constituent features of Bhutanese society before 1959, a socio- economic system based on a Buddhist and feudal set of values. This naturally does not contradict the fact that the substance of Gross National Happiness might have changed over time or might have been supplemented by outside concepts.”1

His Majesty is attributed to have personally conceived and articulated the concept of GNH. As opposed to GDP, the GNH is a comprehensive development process focussed on the wholesome need of an individual human.

GNH is founded in the belief that human happiness is a composite satisfaction of both the material and the non-material needs. It rejects the view that there is a direct and unambiguous relationship between human happiness and economic growth. Blind consumption and wealth accumulation do not necessarily enhance happiness.

According to Lyonpo Jigmi Thinly, “GNH is presently being pursued through four platforms: economic development, environmental preservation, cultural promotion and good governance”. Others like Khenpo Phuntsho Tashi and Diederik Prakke add spiritual promotion as a separate element2 . In this paper, spiritual promotion shall not be taken as a separate element for the sake of simplifying the argument and also because spiritual aspects can be subsumed in the discussion under culture promotion. One of the prime focuses of Bhutanese culture is the spiritual development. Bhutanese culture would constitute the external manifestations as well as the conscious refinement of the mind, which is the essence of spiritual development. Hence culture promotion is an expansive concept as much as it includes the spiritual development. Lyonpo Jigmi alludes to this relationship of the culture and spiritual development when he says, “Within Bhutanese culture, inner spiritual development is as prominent a focus as external material development.”3

Authors like Vladimir Stehlik and Stefan Priesner considers equality also as an important element in GNH. In this paper the concern for equality is interpreted as something that has merely to with the distributive aspects of economic development that is the concern for an equal distribution of income and wealth.

GNH is a process aimed at creating enabling environment for maximization of gross human happiness. Such an enabling environment is anchored in the maintenance of crucial balance between materialism and spiritualism. This is partly a lesson drawn from the experiences of other developed countries. “We asked ourselves the basic question of how to maintain the balance between materialism and spiritualism, in the course of getting the immense benefits of science and technology. The likelihood of loss of spirituality, tranquillity, and gross national happiness with the advance modernisation become apparent to us” (Lyonpo Jigmi Thinly). In the country’s development context, the four platforms of GNH, Good governance, economy, culture promotion and environment preservation, provides intervention areas for the state to strike the balance between spiritualism and materialism.

Maximization of GNH is seen as the ultimate goal of development in Bhutan. GNH enhancement is thus a guiding overall policy objective. In principle all policies and policy reform proposals should be evaluated on the basis of whether it contributes to an increase in GNH.

Unfortunately, the official statements concerning GNH are too general if measured from the need of developing guidelines for such evaluations of policy reform proposals as well as already implemented policies. The concept of GNH is not developed sufficiently to provide operational guidelines and evaluative framework for policy construct, policy assessment and implementation. GNH thus is in need of specification and operational clarification.

What is evident and explicit is that any policy intervention and initiative should maintain and not distort the balance between the four platforms of GNH. However, such a broad premise leaves a lot of room for arbitrary interpretation.

Let me illustrate this by the case of an economic reform such as privatisation (or, more broadly defined, stimulus to private sector economic development). Assume that privatisation has a positive effect on economic growth. Economic development in terms of GDP per capita will be increased. Economic growth is one of the pillars of GNH; hence guidance may be needed to discern if policy such as privatisation should be encouraged as it strengthens one of the pillars of GNH.

However, the four elements of GNH exist in an intricate relationship each influencing the other. A policy initiative directed on any one of the platforms would influence at least one or some of the other elements. The influence may be obvious and direct and often the influence may be subtle and hidden.

In the privatisation illustration, it would possibly have effect on equality in the distribution of income and wealth (possibly causing more inequality in the income), environmental preservation,(if the privatisation is a stimulant to using a lot of natural resources and causing pollution), cultural promotion and good governance. GNH only maintains that a harmonious balance must be maintained between all the four elements. It fails to explain if privatisation as illustrated in the above case should be pursued because it strengthens one of the pillars or is it to be discouraged because it has negative impact on the other elements. What if the positive contribution of privatisation overrides the negative influences it has on the other elements.

What does maintaining a harmonious balance between all the four elements indicate? There are at least five possible interpretations.

· First, the idea of balance may be interpreted strictly literal; this means that an improvement or development of one GNH element should call for development and improvement of all the other elements in an exact measure in order to maintain balance.

· Second, the balance can be seen as maintained if an increase in one of the elements has no negative influence on any of the other four elements.

· Third, the balance can be seen as maintained if as major increase in one of the elements of GNH is accompanied by only a minor deterioration in one or more of the other elements.

· Fourth, the requirements of balance can be seen as linked to the maintenance of explicit minimum standards concerning the other four elements.

Above I have ignored the problems of measuring the effects of privatisation on the four other elements, and of course they are immense and probably insurmountable in practice. For instance, it may be impossible to evaluate the effects of privatisation on cultural preservation. This does not nullify the point made, that is that the concept of balance is ambiguous and in need of a more precise, operational definition.

The evaluation of privatisation policy is obviously dependent on how the concern for balance is interpreted. In case of the first very restrictive definition, privatisation no doubt has to be rejected as a policy reform. It would be very difficult to improve any one element of the four GNH platforms and ensure an exact improvement of all the other four elements as a result. In fact many other policies would not pass this test.

If the second interpretation is adopted privatisation will probably also be seen as negative. As market competition inevitably creates both winners and losers it is difficult to see how to avoid an increased inequality as a result of privatisation. To a certain extent, losers can be compensated but the increased income of the winners may not be fully confiscated by state redistributive policies, and, accordingly, the distribution will become more unequal.

Privatisation, seen as a stimulus to private sector development will have economic centrality. Therefore, economic growth shall predominate all privatisation endeavours. Depending on whether the economic growth thrives primarily and heavily on natural resources and the use of not so environment friendly technology, privatisation would have negative effect on environment. Hence, by the second interpretation, since privatisation will have at least one known negative influence on the four platforms of GNH, the policy may not be recommended.

Whether privatisation can be seen as a policy that enhances GNH is more of an open question if either the third or the fourth interpretation of the concept of balance is adopted.

Privatisation would be seen as positive if its positive effect on economy is large enough to offset the minor negative effects on culture promotion, good governance and environment. Of course, in this situation the policy evaluation depends on the positive effect on economy compared to the negative effects on the rest of the four elements. If the negative effect may be so large that they neutralise the positive effect then the economic reform should not be pursued.

If the economic reform (in casu, privatisation) has a positive effect on economic development this may be evaluated positively from the perspective of GNH, according to this fourth interpretation even if it has negative effects on equality in the distribution of income and wealth, environmental preservation, cultural promotion and good governance if the standards in these four areas are still higher than the minimum standards.

Since privatisation in Bhutan is a deliberate policy since the 6th Five Year Plan, the policy can be assumed as generally perceived as positive by the government. In this case, the third and the fourth interpretations could possibly apply. However, for such an operational guideline, a comprehensive cost or benefit analysis cannot be overemphasised. The benefit of economic growth as a result of privatisation should be compared against the cost on environment, good governance, culture promotion and equality. We may have adequate knowledge and tools on studying the costs or benefit analysis on environment such as the environmental impact assessment study carried out for all projects currently. Certain skills and tools may also be used for studying the influence on equality. But we may be required to develop entirely innovative approaches and methods to study the costs or benefit analysis on culture promotion and good governance.

The fourth interpretation calls for development of minimum standards for the four GNH platforms. Quantitative or qualitative standards should be established to guide any policy interventions and initiatives. Much work on development of minimum standards have been done in the environmental domain such as the forest coverage, protected areas and the mandatory environmental impact assessment. In the other elements of GNH, much deliberation would be needed for evolution of a practical and commonly understood minimum standards.

Privatisation policy and the emphasis on private sector development is relatively new initiative in the history of Bhutan where commerce and trade was almost absent until the early 1960s. Therefore the enabling environment required for privatisation and private sector development are new challenges for the gross national happiness concept.

Some authors like Priesner writes that socio economic pressures such as the urbanization and the unemployment would pose a serious threat to the GNH. The government may be compelled to pursue private sector development vigorously to alleviate such socio economic pressures. According to Stefan Priesner the environment required for a thriving private sector as per the free market precepts are non-existent in Bhutan. He identifies three major enabling environments, which are either contradictory to the prevailing environment or which would pose a challenge to the GNH.

First the present paternalistic role of the government where it directly interferes in all aspects of development is contradictory to the role that the state must assume. Private sector development calls for a retreated state with the role of a “monitoring agent backed by transparent legal framework.”4 While Stefan is correct in describing the present role of the state, the state’s intention is not to maintain that paternalistic role. The desire of the state to assume a role of “enabler” and not “provider” is quite clear. The paternalistic role of the state was evolved out of necessity rather than by deliberate intentions. When planned development was first initiated in 1961, the private sector was virtually non-existent and capital market was absent. The State had to take up the role of “provider” and the “enabler” all by itself. However, the government is explicit in its intention to reduce its role to that described by Priesner for a thriving Private sector. “If the private sector is to become an engine of economic growth, the government will need to redefine its role from that of “provider” to “enabler” of development.”5 Privatisation drive was essentially an effective approach to reduce the role of the state. Government departments are delinked from the mainstream bureaucracy. Private sector is encouraged to enter into all industries, which can possibly be commercialised and is viable for the private sector. Numerous legal frameworks had been instituted.

The second challenge identified by Priesner is the need to restructure the development priorities “towards an increased centrality of economic concerns”. Private sector development with economic growth and wealth accumulation as the primary focus would definitely pose a challenge to the GNH driven development priorities. However the challenge simply calls for a more cautious approach in balancing the four elements of GNH. The GNH does not reject economic growth per se. It propounds for a harmonious maintenance of balance between all the four elements. An economic growth approach that has major positive impact and substantially offsets minor deteriorations in the stability and status of the other three elements would be encouraged.

Priesner also mentions that private sector development requires reorientation of the people’s attitudes from traditional values. Attitudes towards savings, consumptions, work and profit shall be governed by the “rules of the market”. This would possibly impinge on the preservation and promotion of culture. However, such shifts and changes in the traditional values would be acceptable consequences of development as long as certain “fundamental6 ” Bhutanese values are not put to stake. The definition of culture promotion and preservation should not be interpreted in a restrictive sense. Culture promotion should be defined and understood as more inclusive rather than exclusive in nature.

1. 1 Gross National Happiness –Bhutan’s Vision of Development and Challenges, CBS, July 1999. P. 27
2. 2 Gross national Happiness: Concepts for the Debate. CBS. July 1999.
3. 3 Key note speech delivered at the Millennium Meeting for Asia and the Pacific, 30th October – 1 November 1998 Seoul, Republic of Korea. CBS.
4. 4 Bhutan’s vision of Development. Stefan Priesner. 1998 CBS. P. 43
5. 5 Bhutan National Human Development Repost 2000.
6. 6 By fundamental values, I would refer to such culture and values that determine the identity and strongly held belief in the Bhutanese society. Swift changes in such fundamental values would not be accepted by the people and if imposed may lead to disorientation of the society.