Here are the happiest countries in the world — and why they're so happy

ByJames Dennin

What makes a country more or less successful? Economists might look, for example, at gross domestic product to assess whether a nation is financially healthy. But financial health is only one aspect of a country's success and, of course, money isn't everything.

A more holistic approach might also factor in the happiness and well-being of people living in a nation: how much they can count on one another in an emergency, whether they believe business and government are corrupt or trustworthy, and how much citizens are willing to give to charity.

At least that's the thinking behind the World Happiness report, produced by the Sustainable Development Solutions Network and backed by the Ernesto Illy Foundation. Published publicly Monday, the report ranks national happiness using several measures — including GDP — while also factoring in life expectancy, social support, trust, perceived freedom, and generosity.


To arrive at its results, SDSN surveyed more than 3,000 people in more than 150 different countries. Much of the report focused on China, where the relationship between prosperity and happiness has been imperfect to say the least: China's GDP has multiplied fivefold during the last 25 years, but indicators of subjective wellbeing have been unchanged or have fallen. 

In fact, the researchers argue that their findings indicate money might matter a lot less to happiness than previously believed. Simply having more people you can count on when you need help — i.e., strong social ties — can be as effective at boosting happiness for lower-income people as having a 16-fold increase in money.

Curious as to how the United States stacked up in the ranking? You can check out the full top-20 list below, where scores could range from 0 to 10, and higher scores indicate greater happiness.

20. Chile — 6.65

There are a few caveats to the report, naturally. For one, the methodology is relatively new: The first global happiness report was conducted five years ago.

Also, when you're measuring subjective factors like happiness, it's hard to control certain cultural effects on the data. Americans, for instance, seem to give happier answers to survey questions on the weekend than they do during the week — unless they feel like their boss treats them as an equal, and they socialize a lot during the week. Then, the so-called "weekend effect disappears," according to the report. Controlling for all of our unique national quirks is a difficult undertaking. 

But it is heartening to see researchers begin to take the economics of happiness more seriously: In many cases, simply giving someone more money isn't the most efficient way to make them happier. By identifying the different factors that influence our overall well-being, we may be able get a better idea of how to increase happiness with less

Sign up for The Payoff — your weekly crash course on how to live your best financial life. Additionally, for all your burning money questions, check out Mic's creditsavingscareerinvesting and health care hubs for more information — that pays off.