The Happiness Equation and the Physical，Environmental and Psychological Value Index of the Quality of Lift
John E.Weinrich(Faculty of Business Administration University of Macau)
It is increasingly being accepted that the Gross National Product tells very little about a nation's well being or its social and environmental performance. Other measures are needed.
A Physical, Environmental, and Psychological Index is suggested as a way to portray the total physical qualities of life, money and psychic income, extrinsic and intrinsic rewards, environmental friendliness, human comfort and safety of a given population.
The Happiness Equation comprises the what people perceive as vital to the attainment of individual and collective happiness and their acquisition of those perceived wants. The equation H= Satisfactions enjoyed divided by Spe-cific Desires subject to constraints of high principles.
Introduction
The conventional method for representing a nation's performance is to ag-gregate, on a per capita basis, the real market vaiue of the diverse goods and services it produces. The gross national product per person figure (GNP)1 so derived portrays a nation's economic status, which can be compared with previous years' values and with measures similarly obtained for other nations. While the GNP is the most objective measure of national eco-nomic well-being, it is deficient as a method of portraying a nation's present and future social costs and benefits, and it does not indicate in a meaningful way the real well-being of specific individuais or classes of individuals.
For example, the US$4,000 GNP per capita of Macau can be compared with that of the United States, US$22,000. Does this mean that the average Ameri-can is more than five times better off than the average Macau resident? In strictly monetary terms, this may be the case. But, in meaningful welfare and quality of life dimensions, Americans may not be better off at all.
For one thing, the total monetary value of a country's output says noth-ing about how that wealth or income is distributed. The GNP of a country canbe extremely high even when many of its people live below the poverty level. For example, in some Middle Eastern and African oil-rich states, the GNP fig-ure by itself clouds the miserable circumstances in which the bulk of the peo-ple live.
In addition to this, the raw data say nothing about the quality of the goods and services which make up the statistic. Quality is not necessarily reflected in price. The GNP data also exclude information about vital issues. The data do not reveal anything about peoples' life expectancy, the levels of illiteracy or the state of health of the population. The figures ignore family neglect and abuse, homicide and suicide rates, and the extent of drug abuse and street violence. The data are silent about school dropout rates, the degree of sexual and racial discrimination practised, and other serious social ills in society. Then there is the harm and discomfort caused by environmental criminals which are not calculated into GNP figures. The output of factories can puff up GNP statistics, but the environmental damage, in the form of thermal, nasal, visual, acoustic and physical pollution does not appear in the GNP accounts. On the other hand, the data also ignore the psychic income to be enjoyed from a job or from watching a Macau sunset or celebrating Macau's many holidays with friends.
Measures of Human Satisfactions
There is, therefore, a compelling need for other indexes which take account of all the social, cultural, psychological and physical pluses and minuses of the ef-fects of human activity.
Two such indicators are suggested. One measures at the micro level the total intra-personal pleasures and displeasures influencing individuais and the inter-personal dimensions of life. A second index measures at the macro level the physical, environmental and psychological quality of life of all indi-viduals in a society. The first measure can be expressed in the form of a Hap-piness Equation comprising two elements, the intra-personal and the inter-personal elements. The first element contains the several variables that peo-ple perceive to be vital to the attainment of their individual and collective happiness. The Happiness Equation states that Happiness (H) is a function of people's Desires (D) and their Satisfactions (S) of those desires. The equation is H = S + D, and it consists of many dimensions which vary among individu-als and which vary in intensity with respect to specific individuals and, over time, relative to each individual.
The second element consists of principles which are intertwined with good habits. The principles include integrity, reliability, responsibility, trustworthi-ness and fairness. The good habits are to be proactive, to put first things first, to initiate all action with a focus on the objectives to be achieved, to listen with empathetic understanding and then to seek to be understood, and finally to think and act in a 'Win/Win' mode.
The Happiness Equation
The Happiness Equation specifies that a rational person ordinarily seeks hap-piness, which is a personal state of mind. No one can define for everyone or for anyone else what really makes for happiness. It can only be stated that happiness for any individual consists of the extent of one's ability to satisfy seemingly insa-tiable wants. The equation can be expressed in the following way:
H=M/D+So/D+K/D+S/D+A/D+Ac/D+L/D+W/D+P/D+ Fa/D+Tr/D+ Gc+In+Xi/D~<<PR +G .
Where H stands for Happiness M=Material things (including money)
So=Social intercourse, love, affiliation, sex
K=Knowledge
S=Supernatural
A=Aesthetics
Ac=Achievement
L=Leisure W=Wor
P=Power
Fa=Filial piety
Ta = Tradition
Gc = Group cohesiveness
In = Individualism
Xi = Identifiable wants
PR = Principles
G = Good Habits
and D stands for Desire
The equation specifies two concepts. A person's happiness cannot be supe-rior to principles or good habits. A person's happiness can be increased either by reducing desires or wants (D) for any one or more of the categories described in the numerators; or by the acquisition of one or more of the categories of wants. But, in either case, principles and good habits must be greater than the sum of the happiness variables.
The equation indicates that each individual is a composite of numerous re-quirements and that each person designs the strength of the coefficients of each category of want. It specifies that each person wants a variety of happiness-creat-ing things in life but in different proportions as defined by that person. Some reli-gious people, for example, can want very little more than the opportunity of con-templating their god. Managers or politicians may thrive on power. Others may seek material possessions or pleasure. Some cultures emphasise group cohesive-ness while others stress individualism.
The equation also specifies how personalised a person's Happiness Equation can be. For example, a child may appear to be well loved by his or her parents.Yet, if the child perceives that the love received does not satisfy that need, love must be shown in a different way, or more love must be given to the child, lest its happiness be diminished and frustrated. People define their own happiness equa-tion, set their own parameters and their own coefficients.
Good Habits and Principles
The Good Habits and Principles elements of the equation serve to constrain the almost unlimited insatiable wants of people.2 The constraints embodied in the principles and good habits modify people's desires so that happiness is achieved by doing unto others as they would want us to do unto them. The principles and good habits make possible an orderly society which would otherwise be anarchi-cal and self-destructive.
The principles are constant. Integrity or reliability does not change over time or with different people; and they are invariant among different cultures or di-verse circumstances.
Good Habits
Briefly stated, the good habits are:
1) To be proactive by focusing one's time, energy, and action on things which can be influenced or changed rather than on one's own concerns. By knowing what is a good habit, and why it is so knowing how to adopt it, and by wanting and doing the good habit, one proactively writes one's own script rather than follow-ing scripts written by others.
2) To put the end at the beginning by focusing on what is to be accomplished. Doing so becomes the basis for making life-directing decisions founded on un-shakable principles. This habit provides a perspective on how the various parts and principles are related to one another. It makes the ends justify the means.
3) To put first things first is to organise one's scarce time to meet pressing and urgent crises with the right perspective by not neglecting or postponing impor-tant matters. To put first things first energises the doing of things which are im-portant but not urgent in accomplishing one's objectives.
4) To function with a win/win frame of mind is to focus on seeking mutual benefits in one's human inter-relationships. A win/win habit makes one seek op-portunities of cooperation rather than situations of defeating others. It is aban-doned only when situations call for competence or avoidance. It is embraced in all situations where interdependence is the hallmark of effectiveness. It is a habit which requires mutual awareness, mutual learning, mutual benefits and mutual accom-plishment.
5) To listen first before seeking to be understood is the habit of waiting to be sure one understands what has been said before evaluating it, attempting to replyto it, or attempting to refute it. It is the habit of empathising with others by get-ting inside others' skins, hearts and self systems before interpreting what they say. The habit includes presenting one's own logic in a way that is understood by others through empathetic speaking.
The Happiness Equation, the principles and habits of interpersonal perform-ance, constitute the micro or intra-personal aspects of happiness.
The PEP Index
In the macro sense, growth and human happiness can be meaningfully at-tained only when the physical quality of life, the environmental health and the psychological benefits of all people are taken into account. The physical, environ-mental and psychological value index (PEP Index) is a composite of (1) the total acquisitions and external rewards of the population as a whole, and these are summed up in the happiness equations of a population; (2) the environmentally friendliness of society; and (3) the psychological and technical maturity of the population to be ready, able and purposefully committed to principles and the acquistion of good habits.
The PEP Index comprises elements of the Human Development Index com-piled by the United Nations, the various Physical Quality of Life Indexes devel-oped by social scientists, and some additional elements. The PEP Index is best calculated in behaviourally anchored ratings which define standards of perform-ance in quantifiable terms.
Thus, to have a measure of the nutritional and health performance of a na-tion, the focus is on the life expectancy at birth of a given population rather than on the factors which foster that life expectancy. It can be argued that a national life expectancy of anything near 99 suggests that the nation's number of hospital beds, physicians and other health professionals per 100,000 population and that other health safeguards and disease control methods, including high nutritional stand-ards, are acceptable. The PEP Index could establish that a life expectancy of 99 years, as used in life insurance mortality tables, is the highest ranking. In that case, Macau's life expectancy at birth of 71 years has a rating not as high as that of Japan (78) or Hong Kong (76) but higher than that of Mozambique (47) or Af-ghanistan (47). The index suggests the need for improvment of Macau's health services but it does not pinpoint where those improvements should be made. It would be difficult to compile an index which would do so.
Also, it is not necessary to tabulate the number of educational institutions in a country, or the number of its newspapers, radios, television sets or libraries to judge its technical maturity. It is sufficient to know the educational attainment of its total population, its literacy rate, and the percentage of people in different cat-egories living at or below the poverty level. These values will be high or low de-pending upon the factors which create them. If the literacy rate in Japan is 99%, then Hong Kong's (88) and Macau's (88) can be considered satisfactory but need-ing improvement. If the educational level of attainment is secondary school, onecan conclude that the population has an acceptable technical maturity. If the ma-jority of a population completes tertiary education, the same conclusion can be drawn about its professional maturity.
Measures of environmental friendliness can be incorporated into the PEP Index by establishing such parameters as how many decibels of noise can be toler-ated in a given area from a specific source, what amounts of waste matter are uncollected, and what levels of pollution are considered acceptable for air, water and thermal pollution enforcement purposes.
The common points of complaint that contrive to make for a low PEP index value in other parts of the world have not yet surfaced in Macau. For example, the levels of unemployment or underemployment in Macau are not serious. The rate of inflation is not staggering. Its public transportation services are not over-stretched. The crime rate in all categories is remarkably low for a country which has the highest population density in the world. The number of homeless in Macau is low, as is the incidence of poverty among specific groups.
The upshot of this paper is that managers should take the Happiness Equa-tion and the Good Habits into account when establishing reward systems and train-ing programmes; governments should take into account the Happiness Equation and the PEP Index when formulating and implementing their fiscal policies; and individuals should identify the coefficients and the variables of their Happiness Equations and develop good habits and high principles for effective living.
Whether Macau can be said to be happy, is for you to decide for yourselves.
Notes
1 Paul Samuelson, Economics (New York: McGraw-Hill, 1991), Chapter V.
2 Stephen R. Covey, The Seven Habits of Highly Effective People (New York: Simon and Schuster, 1989), pp. 47-54.
