a)In my opinion, on the one hand, pursuit of happiness seems a sacrifice of economic growth as people demand better work-life balance, more holidays(maternal leave) and leisure time. This lead to shorter working hours and hence productive capacity of workforce may decrease. However, this is not a problem if productivity can be improved. With skill upgrading and proper mechanizations, R&D and so on, productivity of workforce will rise as well as productive capacity. Moreover, as the workforce becomes generally happier, they may be more able to focus on and devote to work, further boosting productivity. In the long run, a happier working population may encourage couples to produce more babies as work is no longer a burden to them, thereby increasing quantity of labour in the future.
On the other hand, pursuit of happiness will lead to increased desire for consumption. Consumption of general goods and service helps to create more jobs and reduce unemployment, while pursuit of art and culture makes Singapore’s culture more diverse, which encourages innovation and attracts foreign talents.
Therefore, I expect pursuit of happiness to contribute to economic growth rather than sacrifice.
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
I feel that the pursuit of happiness in Singapore does not necessarily mean a sacrifice of our economic growth. As connectivity increases in the world and competition reaches new heights, countries tend to largely pursuit economic growth, disregarding many other aspects such as the level of contentment of people with their jobs, the lives and the general well-being of the people. If we were to continue in this manner, there may come a point when all these other factors begin to play a much larger role, and productivity and efficiency drops due to discontentment at work and increasing levels of stress, which can possibly happen in Singapore. As such I think that GNH is good in the sense that it does address some of the short-comings of GDP as an economic indicator.
If Singapore decides to use the GNH as its main economic indicator, we would then be searching for ways and means to increase the level of satisfaction and happiness in the country. When people are happier and able to carry out their job more efficiently (for example, if the level of stress is not very extremely high and they can focus better) then we would be able to progress more, as mentioned by Meng Yi, and I also agree with the examples she gave. =)
However, keeping in mind that Singapore relies heavily on trade and FDI, the GDP is quite an important indicator of our economic growth, and there is the possibility that switching to GNH will result in a fall in our economic growth because GDP would be able to highlight the kind of profits made by the country through our heavy trade, and without it we may not be able to compete with other countries! :/ also continuing from Meng Yi’s starting few points, if we use GNH and boost the level of contentment, it may result in a drop in motivation to work and put in more effort (because if you are very happy already, then you may not want to work so hard).
Haha wow ok that was a mouthful :O :P
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
I think it would take quite some time for countries who have been relying on the GDP all this time to be able to change to GHN. GDP is a more quantitative measure while GNH is a quality measure. It can be argued that qualitative measures can be subjective and thus inaccurate. However, so can the GDP, because what is included and what is excluded in determining the GDP is also debatable. I think that it would be difficult for countries to switch to an alternative way to measure growth, and it would still take a lot of time and analysis before any such moves are made. Also, if a country were to switch, it has to take into account the competition its facing from others, and whether or not this move will cause them to lose out to the rest. This can be seen from China’s case where they tried out the “Green GDP” in 2004 (as mentioned in the previous article Ms Lee posted) which caused their growth figures to plummet. Perhaps in future, after the GNH has been carefully studied and improved upon, we can find a measure which takes into account both qualitative and quantitative aspects more effectively, and everyone can switch to using that so that we can work towards less environmentally harmful, less mentally stressful and basically healthier progress. =)
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
I believe that more often than not, the pursuit of happiness will compromise Singapore’s economic growth.
Taking the issue of foreign talents and foreign workers for instance, Singapore citizens are generally unhappy with the immigration policy. Foreign talents benefit the economy in terms of preventing brain drain in Singapore. However, the inflow of foreign talents increases the level of competitiveness both in education and workplace. Singaporeans have to compete harder, making them more stressful. Without these foreign talents, they may be able to study or work in a more relaxed environment, thereby increasing their happiness level. However, the absence of these foreign talents will cause the brain drain phenomenon, in areas of R&D in particular, which is crucial for economic development. Moreover, without competition, Singaporeans would have less incentive to work harder and their productivity may decrease. This applies to the foreign workers as well. It is believed that foreign workers generally suppress the wages of less skilled Singaporean counterparts, making them less happy. However, these foreign workers are needed for all the construction work for Singapore's ever-expanding skyline and economic development. They cannot be expelled just in order to increase the happiness level of those less skilled Singaporeans.
Mengyi and Neha argued that as workers pursue happiness, they become happier and are more devoted to their work. Their productivity will then increase, thereby boosting economic growth in Singapore. I would like to further present a case-by-case analysis on this view. Source of happiness can come from leisure activities for a certain group of people. Given a choice, this group of people would rather pursue happiness in leisure activities which do not contribute to any increase in productivity, than to reflect this pursue of happiness in enhancing his or her work performance. This could, however, be impractical in the long run as people need income to spend on these leisure activities. There is another group of people whose source of happiness comes from high income. Thus as they pursue for happiness, they will work harder in order to get higher income which will then make them happy. Such a circular movement will indeed boost economic growth.
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
To some extent, pursuit of happiness will mean a sacrifice of economic growth in Singapore, however,a balance should be striked between level of happiness and economic growth as happiness of the people may instead spur greater economic growth (in terms of higher productivity when happiness of workforce increases)
In terms of potential growth=>to encourage potential growth, Singapore has to step up on investments as well as increasing productive capacity. With more investments (Foreign direct investments or investments made locally)there is spare capacity to cope with the increasing demand (AD curve) in the future when the economy expands (AD shifts right) so that there will be minimal inflationary pressures on the general price levels when the economy grows. By encouraging more investments and in turn greater economic growth in terms of potential growth, Singaporeans can enjoy more stable prices in the near future because inflation is reduced to the minimum when spare capacity allows for expansion of the local firms.
In terms of actual growth, when national output increases,GDP per capita increases due to the income approach, thus, people have greater spending ability and their standard of living may improve, this may encourage them to do things that they like or consume more luxury goods (eg cars), increasing their happiness levels.
Happiness level takes into account welfare of the citizens as well as level of satisfaction with their current lifestyles. This may contradict the implementation of the upcoming government policy to push up domestic productivity levels among the labour force. If stepping up production means having to work harder for the same working hours or working for longer hours, and even sacrificing more leisure time for extra training programmes, then happiness level of the labour force may drop because these harsh conditions at work will affect their satisfaction with life.So even though overall GDP per capita may increase with increased national output, the people may not be as happy as they were originally.And if the government does without these policies for the sake of bringing up the happiness levels of the workforce, economic growth may slow down when national output does not show growth over the years. However, with other policies implemented like the Resilience Package as well as the Workfare Income Supplement scheme(where lower income workers benefit from greater wage benefits), which encourages people to take up refresher or training courses and be subsidised by their companies, happiness level of people can still be pursued alongside with the economic growth of the country.
Moreover, when urging economic growth in the country, there are many positive spillover effects like greater employment opportunities for the locals when the companies expand their productions, higher wages enjoyed among all Singaporeans when national output=national income rises (so GDP per capita rises). Also, with greater economic growth, Singapore being a small but very open economy will expand the trade sector and conduct trading on a greater scale, thus this may benefit consumers (increase in welfare) when we have a greater variety of products to choose from due to increase in trading frequencies and partners around the world.
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
After reading the comments posted, I strongly agree with the views presented above. The pursuit of happiness will not hinder but boost the economic growth in Singapore. Considering the case in Bhutan, where GNH is used, it appears that the pursuit of happiness slows down the rate of economic growth. However, it will not be the case in Singapore. The people in Bhutan is more concerned with spiritual happiness which seldom requires material comfort. What they enjoy may not be related to economic development. But in Singapore, where people are having a pragmatic mind and many appreciate material comfort. Happiness is usually how much and how well they consume. Hence the pursuit of happiness in Singapore would be similar, if not equivalent to pursuit of economic growth. AD will increase if Singaporeans are to buy more goods and enjoy more services to achieve a higher level of happiness.
On the other hand, pursuit of happiness may not necessarily reduce the output. Although people may choose to work less, their productivity will increase if they work happily. And if they are happy in their jobs, much work can be done well with little surveillance. This reduces the monitoring cost and makes the production more efficient. Therefore the quality of the resource which is labor in this case improves, causing AS to increase. As a result, there will be an economic growth.
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
I totally agree with Neha! The subjective nature of GNH is the major reason why it is not chosen. Compared to GNH, GDP is easier to measure and quite objective. While countries are studying GNH, it is not likely that they will use it as the major measurement of standard of living and quality of life in the countries, but rather they will use GNH as a supplementary indicator of GDP. Although GNH sounds like a perfect measurement (in philosophy, the ultimate goal of human beings is happiness), it is extremely difficult to carry out as lots of problems regarding how to define, measure and increase happiness may occur.
b) GNH is a normative concept while GDP is a positive concept, hence GDP is easier to evaluate and it may more able to convince the population given its more objective nature (agree with Neha). GNH is unpredictable as different people have different definition of happiness. This may be attributed to different cultural backgrounds and educational level. While a farmer (probably with lower education level) may be happy with enough food, a while collar worker is unlikely to be happy with it. Therefore, GNH is too subjective to be used for economic growth policies and resource allocation. e.g. Bhutan has low GDP growth but yet they have very high GNH. Very few people in Bhutan have access to the internet and electronic device such as TV and computer, most Bhutanese value spiritual pursuit more importantly. But sometimes spiritual pursuit of happiness may be blinded. If a country spends majority of its income on construction of worship places in order to fulfill its population’s spiritual pursuit when its basic infrastructure is even not adequately developed (such as roads and sanitation), its economic progress will be hindered and its people’s health is subjected to outbreaks of contagious disease. Therefore, it may not be very wise to use GNH to guide resource allocation.
On the other hand, happiness level of the people should not be neglected as a discontent population may spell disaster for an economy when workers strike and stop working. That’s probably why many governments continue to study good and spiritual benefit.
a) regarding Liu shuang’s comment: “Given a choice, this group of people would rather pursue happiness in leisure activities which do not contribute to any increase in productivity, than to reflect this pursue of happiness in enhancing his or her work performance.”
1, pursuit of happiness will increase productivity when people concentrate on their work so that they can finish early and enjoy the time left through leisure activities.
2, Tourism and trade, which are important sources of income for Singapore, stem from the pursuit of happiness. A lot of countries around the world now are jumping to attract tourists because the inflow of tourists drives up demand for goods and service. How can we then say the pursuit of happiness cannot contribute to economic growth, especially when Singapore’s government strives to brand it as a tourism hub by constructing IR? Given Singapore’s pragmatic nature of government, IR is built in order to generate more jobs and revenue, which in turn contribute to economic growth.
In short, if we link pursuit of happiness to AD, we will see that it is actually similar to pursuit of actual economic growth. But for potential growth, it’s hard to say.
(shuang, my language skills are limited. Hope my tone of rebuttal is not so strong and will not hurt you…:)
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
GNH is not suitable as an indicator due to its measurement and interpretation problems. I agree with Neha that GNH is rather intangible and hard to be measured. The use of GNH renders international comparisons of relative well-being more problematic because happiness is a subject concept and there is no common scale to give the score. In addition, the interpretation of GNH is limited compared to GDP. A country with higher GDP is likely to have greater consumption of goods and services, which implies better economy, standard of living, healthcare, education and even military. A higher GNH, on the other hand, can hardly imply anything. For example, there is no direct link between GNH and standard of living (SOL). Taking Bhutan which chooses to measure its people’s well-being with GNH as a typical example, it is ranked 8. Ranked before it are Finland and Sweden which are known to be developed countries with high SOL; after it is Brunei which is a developing country with relatively low SOL. Since factors like SOL is an indicator to the economic activities in a country, GNH will not be useful to generate data which are then used for their policies on economic growth and resource allocation. It is still studied as people do realise the limitation of GDP and how when developing countries try to boost their economic growth, external costs like environmental degradation and exploitation of workers come in. Social welfare and well-being will then be overstated. Striving towards a higher GNH will perhaps then improve the social welfare as a whole.
Thanks for Mengyi’s comment and I found it truly intellectually stimulating in defending my own concepts. :)
1. Regarding Mengyi’s comment, “pursuit of happiness will increase productivity when people concentrate on their work so that they can finish early and enjoy the time left through leisure activities.” I would like to say that this particular group of people that I have identified pursue happiness purely from leisure activities. Therefore they will not even spend their time working as that is not their source of happiness. If they suffer from unhappiness from their work and now they want to pursue happiness, what they will do is spend all their time not working at all. And I recognised the limitation in this view in the long run as they still need to have certain income to spend on these leisure activities. Therefore I suggested, in my previous post, another group of people who pursue their happiness from high income, which confirmed Mengyi’s point. Therefore, I agree that Mengyi’s comment is valid in certain context but do not think we should assume that all people will concentrate on their work in their pursuit of happiness. Also, I do not think that if people increase their productivity, they can leave the working place early due to the fixed official office hours. Therefore their increase in productivity may not grant them more time to enjoy leisure activities. Their increase in productivity will at most lead to higher output or wages.
2. Linking back to the article and the question, “Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore”, I suppose the question is discussing the issue of happiness and economic growth from the perspective of Singapore, therefore this pursuit of happiness is referring to that of the Singaporeans. Tourism, however, is the pursuit of happiness of the tourists i.e. foreigners, not the Singaporeans. As the foreigners pursue their happiness in the forms of spending and consuming goods and services in Singapore, it is indeed boosting Singapore’s economic growth, but not that of their own country. Similarly, when Singaporeans pursue their happiness in the form of tourism when they travel to other countries, they will not be contributing to Singapore’s economic growth in terms of increasing its GDP as they are consuming goods and services outside Singapore.
Hey you guys, I apologise for this lagged post on the discussion. I'd just like to share some of my perspectives on the issue as well:
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
Personally, I believe that it is not necessarily so that the pursuit of happiness will mean a sacrifice of economic growth in Singapore. The "pursuit of happiness" is, in fact, a very subjective term as mentioned by my fellow classmates above, which means that different people have different notions on the concept of happiness. Perhaps a claim could be made that more Singaporeans are viewing success in the working world as a form of happiness in this day and age, which would then actually be a contributor to the economic growth of Singapore as one would increase productivity and work efficiency in order to rise up and climb the corporate ladder. A reason which could explain why such a claim can be made in the Singapore context is the increased understanding of the importance of power and standing in society due to the higher education levels of Singaporeans in the modern world.
Likewise, the pursuit of happiness to some others could be that of shopping or retail therapy, which in essence is consumerism, which will increase when more people pursue this form of happiness and will result in economic growth in the end. So my point is that the way in which one pursues happiness also matters when considering whether or not the economic growth of a country is sacrificed. Therefore, I believe that the pursuit of happiness can go hand in hand with the economic growth of a country and is not mutually exclusive with each other as implied from the question, which is a stand I think most of us have taken.
All that being said, I must also acknowledge that I do agree with the fact that the pursuit of happiness could result in a sacrifice of economic growth in Singapore as well, as perhaps to most of us, having much leisure time and "slacking around" is considered happiness, which would not be contributing factors to economic growth.
Part b will be continued at a later date so hopefully in the meantime, if anyone happened to read this contribution of mine, I welcome any comments on it at all and a lively discussion could ensue (: Let's all strive to make this economics blog a lively one where we can improve in our understanding of economic concepts and give our own opinions on various economic issues(: Much thanks to Ms. Lee for creating this blog!
a)In my opinion, on the one hand, pursuit of happiness seems a sacrifice of economic growth as people demand better work-life balance, more holidays(maternal leave) and leisure time. This lead to shorter working hours and hence productive capacity of workforce may decrease. However, this is not a problem if productivity can be improved. With skill upgrading and proper mechanizations, R&D and so on, productivity of workforce will rise as well as productive capacity. Moreover, as the workforce becomes generally happier, they may be more able to focus on and devote to work, further boosting productivity. In the long run, a happier working population may encourage couples to produce more babies as work is no longer a burden to them, thereby increasing quantity of labour in the future.
ReplyDeleteOn the other hand, pursuit of happiness will lead to increased desire for consumption. Consumption of general goods and service helps to create more jobs and reduce unemployment, while pursuit of art and culture makes Singapore’s culture more diverse, which encourages innovation and attracts foreign talents.
Therefore, I expect pursuit of happiness to contribute to economic growth rather than sacrifice.
b) to be continued next time, tired...
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
ReplyDeleteI feel that the pursuit of happiness in Singapore does not necessarily mean a sacrifice of our economic growth. As connectivity increases in the world and competition reaches new heights, countries tend to largely pursuit economic growth, disregarding many other aspects such as the level of contentment of people with their jobs, the lives and the general well-being of the people. If we were to continue in this manner, there may come a point when all these other factors begin to play a much larger role, and productivity and efficiency drops due to discontentment at work and increasing levels of stress, which can possibly happen in Singapore. As such I think that GNH is good in the sense that it does address some of the short-comings of GDP as an economic indicator.
If Singapore decides to use the GNH as its main economic indicator, we would then be searching for ways and means to increase the level of satisfaction and happiness in the country. When people are happier and able to carry out their job more efficiently (for example, if the level of stress is not very extremely high and they can focus better) then we would be able to progress more, as mentioned by Meng Yi, and I also agree with the examples she gave. =)
However, keeping in mind that Singapore relies heavily on trade and FDI, the GDP is quite an important indicator of our economic growth, and there is the possibility that switching to GNH will result in a fall in our economic growth because GDP would be able to highlight the kind of profits made by the country through our heavy trade, and without it we may not be able to compete with other countries! :/ also continuing from Meng Yi’s starting few points, if we use GNH and boost the level of contentment, it may result in a drop in motivation to work and put in more effort (because if you are very happy already, then you may not want to work so hard).
Haha wow ok that was a mouthful :O :P
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
I think it would take quite some time for countries who have been relying on the GDP all this time to be able to change to GHN. GDP is a more quantitative measure while GNH is a quality measure. It can be argued that qualitative measures can be subjective and thus inaccurate. However, so can the GDP, because what is included and what is excluded in determining the GDP is also debatable. I think that it would be difficult for countries to switch to an alternative way to measure growth, and it would still take a lot of time and analysis before any such moves are made. Also, if a country were to switch, it has to take into account the competition its facing from others, and whether or not this move will cause them to lose out to the rest. This can be seen from China’s case where they tried out the “Green GDP” in 2004 (as mentioned in the previous article Ms Lee posted) which caused their growth figures to plummet. Perhaps in future, after the GNH has been carefully studied and improved upon, we can find a measure which takes into account both qualitative and quantitative aspects more effectively, and everyone can switch to using that so that we can work towards less environmentally harmful, less mentally stressful and basically healthier progress. =)
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
ReplyDeleteI believe that more often than not, the pursuit of happiness will compromise Singapore’s economic growth.
Taking the issue of foreign talents and foreign workers for instance, Singapore citizens are generally unhappy with the immigration policy. Foreign talents benefit the economy in terms of preventing brain drain in Singapore. However, the inflow of foreign talents increases the level of competitiveness both in education and workplace. Singaporeans have to compete harder, making them more stressful. Without these foreign talents, they may be able to study or work in a more relaxed environment, thereby increasing their happiness level. However, the absence of these foreign talents will cause the brain drain phenomenon, in areas of R&D in particular, which is crucial for economic development. Moreover, without competition, Singaporeans would have less incentive to work harder and their productivity may decrease. This applies to the foreign workers as well. It is believed that foreign workers generally suppress the wages of less skilled Singaporean counterparts, making them less happy. However, these foreign workers are needed for all the construction work for Singapore's ever-expanding skyline and economic development. They cannot be expelled just in order to increase the happiness level of those less skilled Singaporeans.
Mengyi and Neha argued that as workers pursue happiness, they become happier and are more devoted to their work. Their productivity will then increase, thereby boosting economic growth in Singapore. I would like to further present a case-by-case analysis on this view. Source of happiness can come from leisure activities for a certain group of people. Given a choice, this group of people would rather pursue happiness in leisure activities which do not contribute to any increase in productivity, than to reflect this pursue of happiness in enhancing his or her work performance. This could, however, be impractical in the long run as people need income to spend on these leisure activities. There is another group of people whose source of happiness comes from high income. Thus as they pursue for happiness, they will work harder in order to get higher income which will then make them happy. Such a circular movement will indeed boost economic growth.
b) (To be continued.)
-Liu Shuang
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
ReplyDeleteTo some extent, pursuit of happiness will mean a sacrifice of economic growth in Singapore, however,a balance should be striked between level of happiness and economic growth as happiness of the people may instead spur greater economic growth (in terms of higher productivity when happiness of workforce increases)
In terms of potential growth=>to encourage potential growth, Singapore has to step up on investments as well as increasing productive capacity. With more investments (Foreign direct investments or investments made locally)there is spare capacity to cope with the increasing demand (AD curve) in the future when the economy expands (AD shifts right) so that there will be minimal inflationary pressures on the general price levels when the economy grows. By encouraging more investments and in turn greater economic growth in terms of potential growth, Singaporeans can enjoy more stable prices in the near future because inflation is reduced to the minimum when spare capacity allows for expansion of the local firms.
In terms of actual growth, when national output increases,GDP per capita increases due to the income approach, thus, people have greater spending ability and their standard of living may improve, this may encourage them to do things that they like or consume more luxury goods (eg cars), increasing their happiness levels.
Happiness level takes into account welfare of the citizens as well as level of satisfaction with their current lifestyles. This may contradict the implementation of the upcoming government policy to push up domestic productivity levels among the labour force. If stepping up production means having to work harder for the same working hours or working for longer hours, and even sacrificing more leisure time for extra training programmes, then happiness level of the labour force may drop because these harsh conditions at work will affect their satisfaction with life.So even though overall GDP per capita may increase with increased national output, the people may not be as happy as they were originally.And if the government does without these policies for the sake of bringing up the happiness levels of the workforce, economic growth may slow down when national output does not show growth over the years.
However, with other policies implemented like the Resilience Package as well as the Workfare Income Supplement scheme(where lower income workers benefit from greater wage benefits), which encourages people to take up refresher or training courses and be subsidised by their companies, happiness level of people can still be pursued alongside with the economic growth of the country.
Moreover, when urging economic growth in the country, there are many positive spillover effects like greater employment opportunities for the locals when the companies expand their productions, higher wages enjoyed among all Singaporeans when national output=national income rises (so GDP per capita rises). Also, with greater economic growth, Singapore being a small but very open economy will expand the trade sector and conduct trading on a greater scale, thus this may benefit consumers (increase in welfare) when we have a greater variety of products to choose from due to increase in trading frequencies and partners around the world.
Pei Yun
a) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
ReplyDeleteAfter reading the comments posted, I strongly agree with the views presented above. The pursuit of happiness will not hinder but boost the economic growth in Singapore. Considering the case in Bhutan, where GNH is used, it appears that the pursuit of happiness slows down the rate of economic growth. However, it will not be the case in Singapore. The people in Bhutan is more concerned with spiritual happiness which seldom requires material comfort. What they enjoy may not be related to economic development. But in Singapore, where people are having a pragmatic mind and many appreciate material comfort. Happiness is usually how much and how well they consume. Hence the pursuit of happiness in Singapore would be similar, if not equivalent to pursuit of economic growth. AD will increase if Singaporeans are to buy more goods and enjoy more services to achieve a higher level of happiness.
On the other hand, pursuit of happiness may not necessarily reduce the output. Although people may choose to work less, their productivity will increase if they work happily. And if they are happy in their jobs, much work can be done well with little surveillance. This reduces the
monitoring cost and makes the production more efficient. Therefore the quality of the resource which is labor in this case improves, causing AS to increase. As a result, there will be an economic growth.
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
I totally agree with Neha! The subjective nature of GNH is the major reason why it is not chosen. Compared to GNH, GDP is easier to measure and quite objective. While countries are studying GNH, it is not likely that they will use it as the major measurement of standard of living and quality of life in the countries, but rather they will use GNH as a supplementary indicator of GDP. Although GNH sounds like a perfect measurement (in philosophy, the ultimate goal of human beings is happiness), it is extremely difficult to carry out as lots of problems regarding how to define, measure and increase happiness may occur.
b) GNH is a normative concept while GDP is a positive concept, hence GDP is easier to evaluate and it may more able to convince the population given its more objective nature (agree with Neha). GNH is unpredictable as different people have different definition of happiness. This may be attributed to different cultural backgrounds and educational level. While a farmer (probably with lower education level) may be happy with enough food, a while collar worker is unlikely to be happy with it. Therefore, GNH is too subjective to be used for economic growth policies and resource allocation. e.g. Bhutan has low GDP growth but yet they have very high GNH. Very few people in Bhutan have access to the internet and electronic device such as TV and computer, most Bhutanese value spiritual pursuit more importantly. But sometimes spiritual pursuit of happiness may be blinded. If a country spends majority of its income on construction of worship places in order to fulfill its population’s spiritual pursuit when its basic infrastructure is even not adequately developed (such as roads and sanitation), its economic progress will be hindered and its people’s health is subjected to outbreaks of contagious disease. Therefore, it may not be very wise to use GNH to guide resource allocation.
ReplyDeleteOn the other hand, happiness level of the people should not be neglected as a discontent population may spell disaster for an economy when workers strike and stop working. That’s probably why many governments continue to study good and spiritual benefit.
a) regarding Liu shuang’s comment:
“Given a choice, this group of people would rather pursue happiness in leisure activities which do not contribute to any increase in productivity, than to reflect this pursue of happiness in enhancing his or her work performance.”
1, pursuit of happiness will increase productivity when people concentrate on their work so that they can finish early and enjoy the time left through leisure activities.
2, Tourism and trade, which are important sources of income for Singapore, stem from the pursuit of happiness. A lot of countries around the world now are jumping to attract tourists because the inflow of tourists drives up demand for goods and service. How can we then say the pursuit of happiness cannot contribute to economic growth, especially when Singapore’s government strives to brand it as a tourism hub by constructing IR? Given Singapore’s pragmatic nature of government, IR is built in order to generate more jobs and revenue, which in turn contribute to economic growth.
In short, if we link pursuit of happiness to AD, we will see that it is actually similar to pursuit of actual economic growth. But for potential growth, it’s hard to say.
(shuang, my language skills are limited. Hope my tone of rebuttal is not so strong and will not hurt you…:)
b) Why is it that no other country chooses the GNH for their policies on economic growth and resource allocation but continue to study its wider good and spiritual benefits?
ReplyDeleteGNH is not suitable as an indicator due to its measurement and interpretation problems.
I agree with Neha that GNH is rather intangible and hard to be measured. The use of GNH renders international comparisons of relative well-being more problematic because happiness is a subject concept and there is no common scale to give the score.
In addition, the interpretation of GNH is limited compared to GDP. A country with higher GDP is likely to have greater consumption of goods and services, which implies better economy, standard of living, healthcare, education and even military. A higher GNH, on the other hand, can hardly imply anything. For example, there is no direct link between GNH and standard of living (SOL). Taking Bhutan which chooses to measure its people’s well-being with GNH as a typical example, it is ranked 8. Ranked before it are Finland and Sweden which are known to be developed countries with high SOL; after it is Brunei which is a developing country with relatively low SOL. Since factors like SOL is an indicator to the economic activities in a country, GNH will not be useful to generate data which are then used for their policies on economic growth and resource allocation.
It is still studied as people do realise the limitation of GDP and how when developing countries try to boost their economic growth, external costs like environmental degradation and exploitation of workers come in. Social welfare and well-being will then be overstated. Striving towards a higher GNH will perhaps then improve the social welfare as a whole.
Thanks for Mengyi’s comment and I found it truly intellectually stimulating in defending my own concepts. :)
ReplyDelete1. Regarding Mengyi’s comment, “pursuit of happiness will increase productivity when people concentrate on their work so that they can finish early and enjoy the time left through leisure activities.”
I would like to say that this particular group of people that I have identified pursue happiness purely from leisure activities. Therefore they will not even spend their time working as that is not their source of happiness. If they suffer from unhappiness from their work and now they want to pursue happiness, what they will do is spend all their time not working at all. And I recognised the limitation in this view in the long run as they still need to have certain income to spend on these leisure activities. Therefore I suggested, in my previous post, another group of people who pursue their happiness from high income, which confirmed Mengyi’s point. Therefore, I agree that Mengyi’s comment is valid in certain context but do not think we should assume that all people will concentrate on their work in their pursuit of happiness.
Also, I do not think that if people increase their productivity, they can leave the working place early due to the fixed official office hours. Therefore their increase in productivity may not grant them more time to enjoy leisure activities. Their increase in productivity will at most lead to higher output or wages.
2. Linking back to the article and the question, “Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore”, I suppose the question is discussing the issue of happiness and economic growth from the perspective of Singapore, therefore this pursuit of happiness is referring to that of the Singaporeans. Tourism, however, is the pursuit of happiness of the tourists i.e. foreigners, not the Singaporeans. As the foreigners pursue their happiness in the forms of spending and consuming goods and services in Singapore, it is indeed boosting Singapore’s economic growth, but not that of their own country. Similarly, when Singaporeans pursue their happiness in the form of tourism when they travel to other countries, they will not be contributing to Singapore’s economic growth in terms of increasing its GDP as they are consuming goods and services outside Singapore.
Hey you guys, I apologise for this lagged post on the discussion. I'd just like to share some of my perspectives on the issue as well:
ReplyDeletea) Do you expect that the pursuit of happiness will mean a sacrifice of economic growth in Singapore?
Personally, I believe that it is not necessarily so that the pursuit of happiness will mean a sacrifice of economic growth in Singapore. The "pursuit of happiness" is, in fact, a very subjective term as mentioned by my fellow classmates above, which means that different people have different notions on the concept of happiness. Perhaps a claim could be made that more Singaporeans are viewing success in the working world as a form of happiness in this day and age, which would then actually be a contributor to the economic growth of Singapore as one would increase productivity and work efficiency in order to rise up and climb the corporate ladder. A reason which could explain why such a claim can be made in the Singapore context is the increased understanding of the importance of power and standing in society due to the higher education levels of Singaporeans in the modern world.
Likewise, the pursuit of happiness to some others could be that of shopping or retail therapy, which in essence is consumerism, which will increase when more people pursue this form of happiness and will result in economic growth in the end. So my point is that the way in which one pursues happiness also matters when considering whether or not the economic growth of a country is sacrificed. Therefore, I believe that the pursuit of happiness can go hand in hand with the economic growth of a country and is not mutually exclusive with each other as implied from the question, which is a stand I think most of us have taken.
All that being said, I must also acknowledge that I do agree with the fact that the pursuit of happiness could result in a sacrifice of economic growth in Singapore as well, as perhaps to most of us, having much leisure time and "slacking around" is considered happiness, which would not be contributing factors to economic growth.
Part b will be continued at a later date so hopefully in the meantime, if anyone happened to read this contribution of mine, I welcome any comments on it at all and a lively discussion could ensue (: Let's all strive to make this economics blog a lively one where we can improve in our understanding of economic concepts and give our own opinions on various economic issues(: Much thanks to Ms. Lee for creating this blog!