Trouble in Shangri-La

by Nelson Harvey

When GDP growth declines in the U.S., we hear about it all over the place, from the newspaper headlines to the voices of glum news anchors. Contrast our reality with the nation of Bhutan, which quantifies its well being using a “Gross National Happiness” index. The index incorporates things like the preservation of cultural traditions and ecological health, in addition to economic variables. Interestingly, just as a housing downturn threatens to send the U.S. economy into a recession, Bhutan too has seen its official level of happiness decline in recent years.

Many attribute the shift to the infiltration of western media and entertainment, which began with the introduction of television and the internet throughout the country in 1999. According to a story on the NPR program Marketplace, the country has since seen a recorded increase in the breakup of families, as well as violent crime.

The story of declining national happiness accompanying a rise in national wealth is not new. In fact, it has been observed across many economies. Economist Richard Easterlin told Marketplace that the mechanism underlying this trend is fairly simple:

Increases in income are matched by increases in aspirations for income. And the net effect is no change in happiness.

Certainly, Bhutan was never a perfectly happy, peaceful country. The expulsion of thousands of Nepali-speaking minority citizens from the country in recent years is a case in point. But if they’re not achieving total happiness, at least they’re exploring more comprehensive ways to measure it. So are myriad other countries, among them Canada and the U.K. In the U.S., apparently, official methodology remains focused on conventional economics. And despite the impression you might get from the nightly news anchor, it just ain’t that simple.


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