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Home >> Business
UPDATED: 09:23, March 01, 2006
China introduces "happiness index" into regional development evaluation system
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A new economic index, that goes beyond reporting reams of hard industrial data, is emerging from annual meetings of regional legislatures that recently wrapped around the country. It's called the 'happiness index'.

First coined in the city of Xi'an work report the idea is to find a way to measure 'the happiness of the people' not just economic development. The capital of West China's Shaanxi province wants to measure how "the people are sharing the fruits of development and improvements to social harmony".

Beijing is also planning to develop criteria that will allow demographers to create a happiness index of the city's residents. The happiness index will assess the city's performance using five important people-first factors. These include access to medical care, improved housing conditions, quality of the environment, employment opportunities and public security.

The happiness index will create a system to allow governments to evaluate the development of a harmonious society, said Cui Shuqiang, director of the municipal bureau of statistics of China's capital.

The happiness index will also be used to measure progress in building the new countryside.

Along with the people's happiness the country is also developing indices that measure other intangibles such as energy efficiency, advances in science and technology and social development.

China's Eleventh Five-Year (2006-2010) Development Program, which will guide the country's economic and social development calls for cutting its energy consumption by 20 percent by the end of the decade from the 2005 level.

Along with energy savings many regional development plans are looking seriously at conserving water resources. Beijing hopes to cut its water consumption by 20 percent over the next five years and hopes to cut it by five percent this year.

North China's Shanxi Province aims to cut its water consumption by 35 percent by the end of the decade while cutting pollution emissions by 40 percent over the same period.

An innovation index is another intangible that many local governments are planning to measure.

The Beijing municipal government plans to increase its expenditures on research and development to 6 percent of its GDP and will measure progress in the science and technology sector using criteria developed to formulate an innovation index.

Liu Shijin, deputy director of the Development Research Center of the State Council says planners are learning that less is sometimes more. "We are learning to subtract as well as add," he said, adding that an index measuring reductions in energy and water consumption are part of the coming Eleventh Five-Year (2006-2010) Development Program."

East China's Zhejiang Province is also taking a more mature approach to growing its economy. Since the turn of the century the province saw its GDP expand by more than 60 per cent. It is now shifting focus and has cut it planned growth rate for the next five years by 25 percent. The new orientation for growth is on achieving harmony in both economic and social development.

The country's economic powerhouse, Shanghai, along with East China's Shandong and Jiangsu provinces and South China's Guangdong Province, have all reduced growth rate targets. They're now including recycling and 'green' development into their new evaluation system of local government performance.

Mao Shoulong, professor in public administration of the People's University of China, said that the key to enhancing government efficiency is to improve the system for evaluation. The happiness index can provide a true evaluation of effective government work, he said.

Economists interviewed for this report agree that cutting the emphasis on hard industrial indices and increasing the importance of the new social and human development indexes will help measure the quality not just the quantity of economic growth.

The development of the new indexes represents a great change in China's approach to economic growth, said Yang Shengming, a researcher of the Chinese Academy of Social Sciences.

Yang said the indexes used to measure people's happiness, government efficiency and economic growth are all intertwined, adding that without economic growth there will be no possibility of improving people's sense of happiness.

Echoing the sentiments of many locals, a Beijing cab driver says that measuring people's happiness will help economists and governments keep the real goal of industrial development in sight.

Source: Xinhua

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