From ‘Progress’ to an Economics of Happiness


If there’s one thing I’d love world leaders to think about in connection with the UN’s International Day of Happiness, it’s that their measure of progress actually goes up with unhappiness and unrest.

GDP, or Gross Domestic Product, which is still used as the principal indicator for development and progress, simply measures the exchange of money in society: more money changing hands, more commercialization, the higher the GDP.

But what does this mean for human wellbeing? More people sitting at home alone and paying for Netflix subscriptions – GDP goes up. More depressed people paying for pharmaceuticals and psychotherapy – GDP goes up. More stressed and isolated people getting fast food take-out instead of cooking with family or friends – GDP goes up.  War, cancer, epidemic illnesses – all of these things involve an exchange of money, and that means they end up on the positive side of the balance sheet.

It’s not that I believe GDP was implemented as an evil plot to make the world unhappy (actually, the originator of the GDP concept, Simon Kuznets, expressly warned against using it as a sole measure for societal progress). But, by looking through this narrow econometric lens, governments on both the left and right have ended up promoting policies that actually run counter to individual and societal wellbeing.  They have ended up supporting ever more global trade, and with it the amassing of wealth and power by global corporations. This has led to increasing speed, competition and commercialization, which in turn is breaking down the relationships that make life meaningful.

For example, agricultural policy has ended up maximizing agribusiness profits, while eliminating small farmers and fishers and local food economies. In the name of ‘development’, farm subsidies have been doled out to expand commodity production for export markets. Meanwhile, the energy and technology used for importing and exporting food around the world, including giant, fossil fuel-powered, refrigerated container ships, have also been subsidized. The localized, community-centered economies of villages, towns and city high-streets have been undermined, and steadily replaced with sprawling suburbs planned around malls, shopping precincts and superhighways.

GDP has gone up with this kind of globalizing development, but what has been lost? What happens to the wisdom and traditions of land-based people when their livelihoods are destroyed? What happens to mental health when people are forced to migrate to crowded, polluted cities to find work; when networks of community support get replaced by transactional market services? How wide is the hole left by vibrant local shops when they can’t compete with soulless supermarkets? What happens to health and wellbeing when local diets give way to the ubiquitous modern diet of chemical-laden, highly processed food?

This kind of development is precisely what is currently being promoted, most dramatically in the Global South, under the banner of ‘progress’. In the more industrialized countries too, economic ‘growth’ marches on, to the detriment of people’s wellbeing. As profits are increasingly concentrated in the hands of billionaires, the cost of living for the average person is rising sharply, pushing people to work harder and harder to meet basic needs. And, by leaving people’s jobs and livelihoods dependent on fraught supply chains and volatile financial markets, corporate globalization is leading to higher and higher levels of stress.

Meanwhile, studies show that the more time we spend scrolling through our smartphones – entranced by algorithms designed to hold our attention for the profiteering of some of the richest corporations on Earth – the more we experience symptoms of depression and anxiety.

On top of all this, the consumer culture embedded in this version of ‘progress’ deepens our insecurities and lowers our self-worth. From the youngest age, we are groomed to consume by advertising images and social media that make us feel inadequate as we are, and that promote unrealistic standards of beauty and success. As deep community bonds are eroded by economic globalization, the effects of consumer messaging are increasingly severe, leading to self-rejection that, in turn, fuels addictions, violence, and self-destructive compulsive behavior.

In order to move beyond self-blame and isolation, it is important that we recognize the multifaceted ways that the economy assaults our self-esteem, our joy and our happiness. The good news is that throughout the world, people are waking up to the systemic roots of their psychological wounding, and coming together to find refuge and healing.

People are stepping away from the consumer rat-race, and restoring the connections to self, community and nature that are the cornerstones of real wellbeing. In ecovillages, transition towns, mutual aid networks, community gardens and more, people are experiencing the profound psychological benefits of coming together in their local communities, getting their hands in the soil, and engaging in meaningful, productive work. I call these initiatives ‘localization’, because they represent the systemic antidote to globalization. They undo the distancing and anonymity imposed by the global economy, and recover webs of relationships rooted in place.

Throughout our evolution as human beings, such relationships utterly molded our personal identities. Even today, children In indigenous cultures develop their sense of self not through obsessive selfie-taking, peer pressure and celebrity culture, but in extended families, in mixed-age collaborative friendship groups, and with real flesh-and-blood role models. I have witnessed how this leads to secure, grounded identities, which in turn beget a remarkable ease, equanimity, and joy, as well as open-mindedness and tolerance.

In today’s localization initiatives, face-to-face intergenerational friendships come back to the forefront, providing avenues out of the peer-based culture of comparison and competition. By rejecting performative posturing and exposing needs and vulnerabilities, people are gradually moving away from the fear and self-consciousness that kept them apart, while creating more participatory cultures of caring and open-heartedness.

Rebuilding localized cultures offers the chance to transform one’s inner identity – away from isolated individualism, towards expansiveness through greater connectedness with others and with the earth. Research has shown that precisely this kind of egoic transformation can bring with it a physiological impact – sufficient, in some cases, to reverse illness and disease.

But stepping out of the dominant system is a distant dream for an increasing proportion of the global population, many of whom are struggling to put a roof over their head or food on the table. If we hope to change the harsh realities faced by people all around the world, we need more than just the courage to step out of the system – we need to work together to create an economics of happiness.

An economics of happiness would require not only very different measures of societal progress, but also regulatory changes that limit the power and influence of global multinationals, as well as subsidy and investment shifts to boost local production for local needs. With a big-picture, strategic restructuring of economic supports towards localization instead of globalization, we can make healthy local food cheaper than imported, processed food, and local, community-based, stable livelihoods the most abundant jobs available. We can recreate the structural basis for community, and put care for our children and the land back at the center of our daily activities. We can take back control of our own lives, and create the conditions that are a prerequisite for joy, peace and sustainability.

Today’s fast-paced global economy demands mobility, competitiveness, and individualism, and induces a fear of being vulnerable and dependent. Localization, by contrast, answers our deep longing for love and connection – the cornerstones of wellbeing and contentment.

There is ever more research into the deep healing that springs from reconnection to nature and to others, and from spiritually awakening to the oneness of life. Tried and tested twelve-step programs for recovering addicts, which focus on mutual support and contact with a higher spiritual purpose, have been demonstrating compelling results for quite some time. Recently, a myriad of other methods has emerged, including wilderness-immersion and animal-connection therapies, therapeutic horticulture, social prescribing and more.

Localization can create the economic structures that regenerate the fabric of interdependence – in part by promoting daily contact with others and with the plants and animals in the natural world around us. In this way, what are now expensive weekend therapies for a minority could become a fundamental way of life for people all over the world.

The localization movement is comprised of millions of people who have started the process of deepening the connections in their own lives. While they are often driven by a deep-seated concern for nature, for social justice, and for their children’s future, it is their intuitive pursuit of genuine wellbeing that is perhaps their greatest guiding force.

But genuine wellbeing transcends the personal – it is an inherently collective experience. In that sense, the movement for localization is about systemic, structural changes that would nurture happiness on the macro level.

Through strategic shifts in economic policy, we can usher in an economics of happiness for the majority. We can reclaim the very notions of ‘progress’ and ‘development’ from the clutches of commercialization and commodification, realigning them instead with human and ecological flourishing.

Helena Norberg-Hodge is founder and director of Local Futures. A pioneer of the “new economy” movement, she has been promoting an economics of personal, social and ecological well-being for over 40 years. She is the producer and co-director of the award-winning documentary The Economics of Happiness, and is the author of Local is Our Future and Ancient Futures: Learning from Ladakh. She was honored with the Right Livelihood Award for her groundbreaking work in Ladakh, and received the 2012 Goi Peace Prize for contributing to “the revitalization of cultural and biological diversity, and the strengthening of local communities and economies worldwide.”


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