25 Jul, 2007

Next Big Thing: The “Happiness Business”

Imtiaz Muqbil

Bangkok – Is the phrase “travel & tourism industry” now outdated? If a rebranding is long overdue, how about the “happiness business”?

Becoming arguably the first travel trade editor to cover a conference on promoting happiness organised at the UN regional headquarters in Bangkok last week, I was struck by the extent to which the various themes and subjects were of direct relevance to what the travel and tourism business does for a living — strive to make people happy. Temporarily, superficially and fleetingly perhaps, but happy nevertheless.

First drafted by the former king of Bhutan in the early 1970s, the concept of Gross National Happiness is moving from the leftist lunatic fringe to the mainstream of economic thinking. It is designed to replace monetary and financial measurement units as the primary means of gauging human well-being, satisfaction and contentment. Realising that simply promoting higher Gross Domestic Product and Gross National Product as measurement units of economic growth is not making people any happier, economists, academics, consultants and politicians are teaming up with religious leaders, social activists and others who believe that a better way is required to improve the human condition, one that is more socially and economically just as well as less damaging of the environment and culture.

However, it is the pursuit of national economic growth and the wretched lifestyles of the vast majority of working people which helps keep travel & tourism in business. Whether travelling for a simple holiday, an incentive, an health and wellness experience, a gap-year adventure, visiting friends and relatives or a pilgrimage, the vast majority of people travel to flee routine, humdrum, monotonous, stressful lifestyles and enjoy something different, far from the madding crowds, the boss, the neighbours or the mothers in law. Being greeted and served by smiling people in a traditional style, and enveloped in a pleasant, sensual atmosphere is a means of restoring sanity.

So, in a very powerful way, the travel & tourism industry is contributing significantly to making the world a happier place.

Although that is the very core of our existence, the pursuit of happiness is a two-way street. How happy are our staff and employees, whose full-time job it is to make others happy? This “happiness business” is a hugely stressful exercise and can itself lead to much unhappiness. Addressing that challenge, too, means recalibrating the measurement indicators for boosting the happiness quotient of staff first so that they may be more enthusiastic about exporting their state of happiness to others. This industry has a very high level of migrant workers. One study quoted below found that migrants are not a very happy lot because of the extended time away from their families and loved ones.

The new pursuit of happiness also has implications for national tourism organisations. Measuring the “success” of travel & tourism has been entirely based on statistical indicators, such as visitor arrivals, economic impact, investment and job creation. That, too, could become a thing of the past. Measuring the happiness level of satisfied tourists after visiting a destination could become a complementary means of measurement, one that would be far less at the mercy of an accounting process and far more within the control of the host destinations themselves.

At the macro level, having agreed that existing lifestyles and economic and business models are unsustainable, the next step has been to decide how to expand the “happiness” campaign by making it part of public policy. This is a whole new ball game. A “policy” needs to be backed by some kind of indicator, a formula for tracking progress from problem to solution. That’s where much of the discussion is ensuing.

This dispatch excerpts some of the papers and presentations at the International Conference on “Happiness and Public Policy” organised by the Public Policy Development Office (PPDO) of the Thai government. Possibly the first time this subject has been covered in the travel trade media, it will quickly gain traction. Branding gurus will latch on to it, conferences will feature it and industry experts will seek to outdo each other with the perfect solutions and answers. If that happens, and the world becomes even a slightly better and more happy place, the purpose of this dispatch will have been well-served.

The full set of papers can be found at: http://www.ppdoconference.org. Another conference is coming up in Thailand this November. Click here for details: http://www.sulak-sivaraksa.org/en/index.php?option=com_content&task=view&id=172&Itemid=67

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2. EXCERPTS FROM SOME OF THE PRESENTATIONS AND PAPERS

Lyonpo Jigme Thinley, Bhutan’s Minister of Home and Cultural Affairs

Could it be because as more and more of us cross over the thresholds of poverty and basic livelihood, we find the time to reflect on life and its meaning? In so doing, some of us find reasons for dissatisfaction with life as we live it. We are beginning to realize and understand that not only is our way of life as promised and indeed delivered by the conventional process of development, unfulfilling and hollow but that we are living dangerously. We are sensing a dire need for reality check and moderation at the very least, based on some understanding of what matters most in life.

There are many who would agree that ours is a story of how the supposed means to happiness have been mistaken for the end itself. And having lost sight of happiness, we have committed ourselves to a life of endless labour and the goal of mindless growth. For too long, we have chased symbols of success that we believed would give rise to happiness. For too long we have chased illusions. Quite literarily, this journey without a true destination is doomed. That is why we need a clear destination, a new direction. We need to be certain about what it is that we want to achieve through development and how to measure the progress we make.

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What Brings Us Happiness? A New Approach In Economics Which Considers The Wisdom Of Proverbs And Religions [Gherardo Girardi, Economics, Finance and International Business, London Metropolitan University]

For the last sixty years or so, the dominant paradigm in economics, especially in the Anglo-Saxon world, has been to regard happiness, as captured by the notion of utility, as being determined fundamentally by wealth. The higher the wealth, the higher the utility. The human capital model, where agents standing at the start of their working lives maximize lifetime income, is probably the best example of this paradigm.

Agents, as they are called, are only concerned with their own interest, and seek only material gains. Looking back, it is amazing that this paradigm has become dominant: it ignores the religious tradition of the West, Christianity, the insights of other disciplines like psychology, anthropology and psychology, and popular wisdom as to what makes us happy. The paradigm can be seen at work in ordinary people’s lives: up to the 1960’s, I am told, it was common to find whole neighbourhoods in London where people did not lock up their houses; today, this sort of behaviour is unheard of.

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Happiness and Domain Satisfaction: Theory and Evidence [Richard A. Easterlin and Onnicha Sawangfa, University of Southern California]

In the United States happiness, on average, varies positively with socio-economic status; is fairly constant over time; rises to midlife and then declines; and is lower among younger than older birth cohorts. These four patterns of mean happiness can be predicted rather closely from the mean satisfaction people report with each of four domains — finances, family life, work, and health. Even though the domain satisfaction patterns typically differ from each other and from that for happiness, they come together in a way that explains quite well the overall patterns of happiness. The importance of any given domain depends on the happiness relation under study (by socio-economic status, time, age or birth cohort), and no single domain is invariably the key to happiness.

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How Can Collective Action Transform Wealth into Well-Being? [Dr. Buapun Promphakping, Khon Kaen University, Thailand]

There has been longstanding recognition of the potential positive impacts of collective action in development processes. Collective action has variously been argued to have social, political and economic benefits. It may contribute to social capital formation; it may increase the efficiency of democratic institutionalization; and it can also minimize transaction costs in ways that can help to improve economic performance. However, with the increasing acknowledgement that growth or wealth does not simply equate to development, and with growing interest in exploring development from a well-being perspective, the issue of collective action demands further attention.

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How Happy Are The People In Bhutan? A Study From The Perspective Of Quality Of Life [Vijay Kumar Shrotryia, Reader, Department Of Commerce, School Of Economics, Management And Information Sciences, North Eastern Hill University, Shillong, India]

In the times of digital divide and deepened differences amongst the people, the study of quality of population becomes more important and pertinent. The resources and allocations are all directed towards the well being of the people but still there are people who are not able to reap the good fruits and who are not aware of real development. Their understanding of development is much broader and better in many ways than that of so-called developed and powerful groups of the society. Their level of happiness and contentment, their sense of understanding, and the mind with the least expectations speaks volumes of their goodness as human beings.

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Happiness and Economic Growth: Green Growth as Regional Strategy for the Well-being of All [Rae Kwon Chung, Aneta Slaveykova Nikolova and Mr. Simon Hoiberg Olsen, Environment Sustainable Development Division, UNESCAP]

In the ideal world of the neo-classical economists, countries’ development strategies are driven by the necessity for infinite economic growth. This necessity is fuelled by the promise of wealth and capital growth that is believed to bring a decent standard of living for all people. In this best-case scenario, the benefits to overall well-being, if any, are closely dependent on the level of material wealth, which preconditions people’s happiness and enjoyment of life.

In the real world there are quite complex processes at play, which for good or bad, pose serious limitations and challenges to the “ideal world model”. Three points suggest the need for a change of the current economic growth model. Firstly, due to the physical constraints of the planet, infinite economic growth, as traditionally understood, is impossible. Secondly, it is doubtful that material wealth provided by economic growth in all cases will result in higher levels of happiness and spiritual well-being on either micro and/or macro levels. Various reasons for this will be outlined later. Finally, an alternative approach may be needed to conventional economic growth models that, besides providing a discourse towards sustainable economic growth, also suggests ways that can promote happiness and well-being for all. This approach is called Green Growth.

Through the encouragement of environmentally sustainable economic growth, Green Growth aspires to eradicate extreme poverty in the region without compromising the environment. Green growth as a policy approach not only focuses on environmental sustainability, it is also concerned with suggesting ways in which consumers can change their approach to consumption, and businesses can change the way they produce.

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Students’ happiness and well-being. The Case of University of Algarve [Júlio Mendes, M. Manuela Guerreiro, Graciana Vieira, Faculty of Economics, University of Algarve, Portugal]

Even in 350 B.C.E, Aristotle stated that happiness was the only thing that humans desire for its own sake. Although, nowadays is still faced as a subjective meaning, many different disciplines have revealed increased interest in it, as it influences individual’s and community’s well-being. Due to the rising problems that affect youth and the risks that occur in a group relatively vulnerable in terms of ideas, attitudes and behaviours, the teenager’s concerns assume an important question of public policies for most governments of European Union.

The importance of conducting a study at the university level is, in our opinion, justifiable by the rising sense of globalisation, standardization and uncertain future. Today teenagers face this question earlier than a few years ago. The universities, organizations that go along with millions of teenagers in a important period of their life, should be deeply engaged with them and try to be acquainted with their aims – needs, desires and expectations – and help them to achieve these. This way, besides the traditional role of transmitting knowledge and cultural opening, the universities could be co-responsible in leading the process to the existence of high levels of happiness among the students community.

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Social Cohesion, Innovation System, Learning Society, and Lifestyle: Decoding Happiness Infrastructure from Scandinavian Experiences [Dr.Pun-Arj Chairatana, Sudarat Rojphongkasem, Lalana Rojanapaibulya and Chaithad Arthronthommakun, Thailand Reform Programme, Public Policy Development Office]

Sufficiency economy, initiated by His Majesty the King of Thailand, is a holistic concept of moderation and contentment. It sets out to shield the people and the country from adverse shocks, and acknowledges interdependency among people at all levels as an approach, against the backdrop of interdependence and globalization. It emphasizes the use of knowledge wisely with due consideration. Its values include integrity, diligence, harmlessness and sharing. Finally, it seeks to achieve balance and sustainability. Nowadays its application to the development process in Thailand as well as its application in daily lives and various activities at all levels have been widely accepted and implemented.

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And What About the Family Back Home? International Migration and Happiness [Fernando Borraz, Universidad de Montevideo, Susan Pozo, Western Michigan University, Maximo Rossi, Universidad de la República]

To assess the impact of migration on happiness we first estimated a propensity score for migration. These scores were then used to find matched controls for those observations that were “treated” with migration. We found that the matched controls were more happy than the treated. In other words we were able to infer, in this case, that families with migrants are less happy. Migration reduces the happiness of those left behind. In a second experiment we test to see the impact of remittance recipiency on happiness. Are families who receive remittances happier? Can the monetary inflows that often accompany migration make up for the absence of household members through migration? In this case the answer is no. Remittance receiving households are no more or less happy than non-recipient households.

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Putting a Price Tag on Friends, Relatives, and Neighbours: Using Surveys of Life Satisfaction to Value Social Relationships [Nattavudh Powdthavee, Institute of Education, University of London]

What matters more to our happiness – money or social relationships? Using panel surveys of life satisfaction for Great Britain, this paper estimates one of the first micro-econometric life satisfaction equations with frequency of contact with friends, relatives, and neighbours as independent variables. It also makes use of the shadow pricing method, which is more commonly used in the cost-benefit analysis in the field of economics, in order to put a financial value upon social relationships and other life events.

By allowing unobserved individual fixed effects to be factored out from the life satisfaction equation, an increase in the level of social interaction with friends and relatives is estimated to be worth up to an extra £85,000 a year. In terms of statistical significance, this is strikingly large. The estimated figure is even larger than that of getting married (which is worth approximately £50,000). It can compensate for nearly two-third in the loss of the happiness from going through a separation (minus £139,000) or unemployment (minus £143,000). It is also roughly nine times larger than the average real household income per capita in the dataset, which is around £9,800 a year.

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A Buddhist Economic Approach to Employee Volunteer Program: Happiness in the Workplace [Wanna Prayukvong, Assistant Professor, Faculty of Management Science and Ph.D. student of Integral Development Studies, Ubon Rajathanee University, Ubon Ratchathani, Thailand]

Buddhist Economics differs significantly from Mainstream Economics on the paradigm of human nature. The core values of mainstream economics are self-interest and competition to achieve the maximum welfare or utility under resource constraints. While in Buddhist Economics, the core values are compassion and cooperation to achieve well-being through higher wisdom (pañña). Higher wisdom (pañña) is the ability to understand everything in its own nature without personal bias or distortion.

It is a crucial input that is not only used in production but also controls consumption and distribution activities. The Buddha believed in human potential to develop oneself through the Threefold Training (training in morality, mentality, and wisdom) to attain pañña. When pañña is cultivated, people will understand the wider meaning of self. “Self” in Buddhism includes oneself, society, and nature, which are all simultaneously interconnected. Rather than giving supreme importance to an individual’s utility, as in the mainstream economics, happiness is the overriding objective. Happiness is not normally increased through more consumption only, but is also gained through good deeds that people do for their society. The objective of Buddhist Economics is to achieve this well being through the use of pañña.

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Enhancing Technological Capabilities for Happiness: Lessons from Thailand [Nathabhol Khanthachai, Public Policy Development Office, Government House, Thailand]

Having happiness or well-being as a national ultimate goal, nations can achieve such a goal through the development of their technological capabilities which can be regarded as an instrumental goal for happiness. Both subjective and objective well-being should be taken into account as two aspects of the ultimate goal. The direct relationship between technology and happiness or well-being can be positive or negative. The negative effect on happiness of technology such as atomic bombs should be avoided whereas technology in the field of medical sciences such as organ transplanting technology should be promoted. Through an increase in, as well as, equitable distribution of, GDP, particularly GDP per capita, technology can be indirectly related to happiness or well-being. Nations, particularly less and developing nations, with the right policies, can follow Thailand’s path of development in technological capabilities as outlined above for breeding well-being or happiness for their people.