More to a country’s wellbeing than economic success

In 1972, the little Himalayan kingdom of Bhutan did a very radical and wise thing. The king established a Gross National Happiness programme, intended to be a more accurate measure of national wellbeing that GNP, or indeed GNP, the primary indicators of social wellbeing in Western nations. Ireland, currently in the grip of a post-Celtic Tiger hangover, may seem a little way off achieving such wisdom, but not as much as we might fear.  The publication of an important discussion paper on wellbeing and competitiveness by the National Competitiveness Council is another important step in the acknowledgement by government and senior policy makers that the definition of national success must be amplified well beyond the traditional measures of economic wellbeing.

The discussion paper is a thoughtful and, with some caveats, a well-researched exploration of what constitutes wellbeing, the drivers of wellbeing, and the limitations of current measures in measuring wellbeing.  Its particular focus is on the relationship between wellbeing and competitiveness. Its conclusions in that respect are an important milestone in this debate: an environment that supports high levels of wellbeing is an important driver of competitiveness and this relationship is likely to become stronger as Ireland seeks to shift towards the production of knowledge intensive goods and services.  The Council expresses the hope that this discussion paper will encourage further debate and discussion in this emerging area.  In that spirit I offer some observations of the discussion paper.

First, the Discussion Paper documents, as many previous reports have done, Ireland’s remarkable economic success and exceptional performance on current cross-national measures of wellbeing, both objective and subjective. On the UN’s Human Development Index objective measures of wellbeing (life expectancy, educational attainment and adjusted real income) Ireland ranks fourth in the world. On Eurobarometer and Eurofound subjective measures (life satisfaction, levels of happiness and sense of belonging) Ireland consistently performs very strongly. For example, out of 28 countries benchmarked, Ireland ranks fourth for life satisfaction, joint second for happiness and fourth for social belonging.

Yet, Ireland, in common with other developed economies, continues to fret about quality of life – and with good reason. Beyond a certain level, higher GDP or GNP does not translate into increased societal wellbeing or social equality. Levels of life satisfaction and happiness in Ireland have been at much the same level between 1980 and 2004– stubbornly resistant to the extraordinary economic success achieved in the meantime. A significant minority of Irish people (17.6%) regard themselves as being poor in terms of subjective wellbeing, with particularly low levels experienced by nearly a third of unemployed people and over a fifth of lone parents. Concerns about the sustainability of current production and consumption patterns, environmental degradation, crime, social cohesion, equitable access to quality healthcare, accountability and standards in public life – all these concerns gnaw away at national wellbeing.  We don’t directly measure those concerns in GNP.  Neither do we measure the wellsprings of wellbeing, for example, the quality of community, social and intimate relationships (including unpaid caring) and the availability of effective conflict-resolution mechanisms when things go wrong with these relationships.

While the Discussion Paper makes reference to some of those concerns, the National Competitiveness Council, in common with other bodies, needs to make a more robust and spirited argument for the need for expanded measures of national wellbeing that take these issues into account. What does not get measured does not get managed. It might be important to say that clearly. To be sure, measuring wellbeing is complex and cannot be expressed in a neat quantitative, monetized number.  But as the Paper acknowledges, there are ongoing international efforts to develop more complex measures. An important first step would be for Ireland to become more involved in these important initiatives.

Second, current discussions of national wellbeing could benefit from a deeper understanding of the rapid growth in psychological research on happiness, in particular the upsurge over the past decade. For example, the Council’s paper makes a brief reference to some personality and relationship factors that influence wellbeing, for example, the ‘set-point’ theory of happiness.  The problem with that theory,  particularly in its more extreme form (i.e. that people adapt to whatever circumstances they find themselves in; get used to any improvements in their lives; come to expect more, and are still not any happier) is that it can lead to a kind of hopelessness about increasing wellbeing. However, that theory has been considerably modified by more recent research that suggests, for example, that up to 40% of individual happiness is created by being engaged in projects that the individual feels are meaningful and achievable. That finding has very significant implications for policy at many different levels and could serve as a useful guiding principle for interventions at individual level.

Similarly, the discussion of the link between wellbeing and competitiveness could have achieved a better integration between individual, institutional and economic levels. It largely confines itself to citing the evidence that happier people are more productive, and concludes with the rather wistful hope that ‘Given that there is a positive relationship between income and wellbeing, both wellbeing and competitiveness would be enhanced by policies that promote higher productivity’.  I fear that the links in that particular chain may be lost on most people.

Very few people, apart from the Council members, and some government, business, trade union leaders and economic commentators, wake up in the morning thinking about how to make Ireland more competitive. However, most people (apart from those in poorly led and dysfunctional systems) wake up in the morning and would like to do a good day’s work.  We have good evidence that overall job satisfaction is significantly related to the satisfaction of deeper human motivations – the need for meaningful connections at work, for autonomy, and the opportunity to use valued skills.  We have equally good evidence that positive emotions are associated not just with higher productivity, but with better problem-solving, better team working, more flexibility, experimentation, risk-taking, innovation and creativity – all key components of competitiveness. Linking the individual-organisation-economic chain in this way is likely to be more easily communicated and translated into positive policies – for example, by adding ‘the pursuit of excellence’ as a core component or vehicle of competitiveness in terms of individual achievement, organisational goals and national aspiration.

Third, while the Discussion paper teases out the complex relationships between income and happiness, it makes no explicit reference to the current economic downturn and its possible impact on wellbeing.  For example, while at a national level higher GDP (i.e. above a certain threshold) does not translate into higher life satisfaction, at an individual level, higher income does. Any threats to that personal income will threaten wellbeing. In addition, human beings show extreme aversion to loss of any kind. Faced with the threat of loss, people typically immediately assign a higher value to what they might lose. This is a very powerful argument for the link between national competitiveness, individual income and wellbeing.

Fourth, the discussion paper misses a golden opportunity to stress again just how interconnected the concept of wellbeing is how its achievement depends on a systems-wide approach.  Individual government departments, the social partners and others beaver away at elements of wellbeing. At best, individual wellbeing and happiness are seen as ‘emergent’ properties of good policies. At worst, they are simply out of awareness. Instead, what we need to develop is a deep capacity for systems intelligence and for building new kinds of collaborative partnerships between government, business and civil society.   Mapping the pathway to wellbeing and happiness – at individual, community and national level – depends on many decisions by many people at different levels. Leaving it as an ‘emergent’ property rather than stating it as an explicit and shared goal with relevant metrics and short-term, mid-term and long-term goals – risks fragmentation and drift.   The commitment to improving social as well as economic wellbeing in the current Social Partnership Agreement ‘Towards 2016’ is a welcome move in this direction – a point strongly acknowledged in the Discussion Paper.

While we may not be ready yet to institute Gross National Happiness as a measure of  national success, the idea of Gross National Happiness has great visionary and symbolic power.  It has the potential to promote what has been called ‘the triple bottom line’ – People, Planet, Profits – and underlines that they are part of one interconnected system.  It can act as a unifying, over-arching framework for action and can strengthen the process of reflection-dialogue-experimentation-correction that is the basis of good learning, good policy design, and sustainable national competitiveness.  It is to be hoped that this discussion paper by the National Competitiveness Council is a step in the national happiness direction.

Originally published in The Irish Times.

Posted: 24 July 2008