On the eve of the millennium, in 1999, Bhutan granted its citizens access to television—the last country on the planet to do so. (The Internet trickled in the same year.) Euphoria reigned in the towns as the outside world in all its garish glory beamed into shops and living rooms. Pulling the lid off Pandora’s box, however, raised concerns. What happens, after all, when an isolated, deeply conservative society is suddenly exposed to gangsta rapper 50 Cent and the World Wrestling Federation? Such questions carry extra weight in a vulnerable nation of 635,000 people, half of whom are under 22 years old.

Now comes the daring culmination of Bhutan’s experiment: the move to democracy. Never before, say Bhutanese officials, has a beloved monarch voluntarily abdicated his throne to give power to the people. But in 2006 King Jigme Singye Wangchuck did just that, setting up an unusual convergence of events in 2008: a coronation (the fourth king ceremoniously hands over the raven crown to his 28-year-old son, Jigme Khesar Namgyel Wangchuck, who will serve as a constitutional monarch); a centennial celebration (the monarchy’s hundredth birthday was in 2007, but a royal astrologer deemed this year more auspicious); and, most important, the formation by this summer of the country’s first democratic government.

The real test of Gross National Happiness, then, is just beginning. Bhutan’s new civilian leaders will face a raft of challenges, not least of which is a public that remains enamored of its kings and skeptical of democracy. The outside world peers in, wondering if this once forgotten Himalayan nation might help answer some of humankind’s most vexing questions: How can a society maintain its identity in the face of the flattening forces of globalization? How can it embrace the good of the modern world without falling prey to the bad? And can there ever be a happy balance between tradition and development?