By the end of this year, King Jigme Singye Wangchuck, whose family has ruled over Bhutan for almost a hundred years, will officially hand over power to the people. Nobody wants to see him go, but the king himself has decided that he must take a less active role in government. By his own account, he does not want to see the throne stand in the way of the remarkable modernization under way in Bhutan.

Under the current king's rule, this tiny Himalayan kingdom (whose population is still unknown, but which is estimated to range from 700,000 to about two million people) has become a rare innovator among developing nations. Rejecting the models of urbanization and unregulated market development usually promoted by the U.S. government, the king has crafted the framework for a political economy based on a theoretically harmonious mix of representative government, south-Asian-style capitalism, traditional religious values, environmentalism, hydropower, tourism, mandated preventative medicine, and universal health care.