is an index of human well-being and environmental impact that was introduced by the New Economics Foundation (NEF) in July 2006. The index is designed to challenge well-established indices of countries’ development, such as Gross Domestic Product (GDP) and the Human Development Index (HDI), which are seen as not taking sustainability into account. In particular, GDP is seen as inappropriate, as the usual ultimate aim of most people is not to be rich, but to be happy and healthy. Furthermore, it is believed that the notion of sustainable development requires a measure of the environmental costs of pursuing those goals.
A recent review of progress indicators produced by the European Parliament, lists the following pros and cons to using the HPI as a measure of national progress:
Pros:
1. Considers the actual ‘ends’ of economic activity in the form of life satisfaction and longevity
2. Combines wellbeing and environmental aspects
3. Simple and easily understandable scheme for calculating the index
4. Comparability of results (‘EF’ and ‘life expectancy’ can be applied to different countries)
5. Data online available, although some data gaps remain
6. Mixture of ‘soft’ and ‘hard’ criteria; takes into account people’s well-being and resource use of countries
Cons:
1. ‘Happiness’ or ‘life satisfaction’ are very subjective and personal: cultural influences and complex impact of policies on happiness
2. Confusion of name: index is not a measure of happiness but rather measure of environmental efficiency of supporting well-being in a given country
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