Written By Sinchana Raj (Grade 11)


Countries have been measuring their growth solely in terms of their economic development (GDP) but growth does not only mean it should be economical. Here comes the Happy Planet Index (HPI) introduced in the year 2006 by the New Economics Foundation (NEF). Gross Domestic Product (GDP) measures the economic growth of the country whereas HPI measures how well people can lead a quality life by keeping within the environmental limits.

What is actually HPI and how is it calculated?

HPI is an index that refers to the overall wellbeing of humans and the environment surrounding us, mostly concerning our sustainable wellbeing. It concentrates on the quality of life led by us and the efficient use of our natural resources.

HPI has several factors that affect it which includes the income level, ecological footprint, subjective wellbeing, individual’s health and also life satisfaction of each individual (happiness). Happiness here would mean higher life satisfaction, subjective wellbeing, positive feelings, healthy relationships and low negative feelings.

“Subjective wellbeing is the scientific term for happiness and life satisfaction, thinking and feeling that your life is going well, not badly.” – Edward Diener

Happy Planet Index is calculated by scoring countries on the following parameters:

  • Well-being: How satisfied the residents of a country are, indicates their well-being
  • Ecological Footprint: It takes the average impact made by each of the citizens in the country on the environment.
  • Inequality of Outcomes: How is the inequality factor in both social and economic lives of individuals in the countries measures this component.
  • Life Expectancy: It is the average number of people expected to live from their birth year.

The formula to calculate HPI of a country:

HPI = (Wellbeing*Life Expectancy*Inequality of Outcomes)/Ecological Footprint

Costa Rica the country in Central America leads the world in HPI, 99% of the electricity here is managed through renewable sources. An interesting fact to note is that although the western countries have grand success in their economic upfront, they are led by Asian countries and Latin America in terms of HPI. This is mostly because western countries pay a high environmental cost due to their economic development.

Measuring the country through its HPI gives us insight into the personal wellbeing of each of the citizens in that country and is an important indicator to consider.


Featured Image Courtesy – RPubs

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