Economic output is a crude measure of national success. It accounts for negative transactions (like sales of handguns) as much as positive things (like education spending). Rich people do tend to be happier. But the same isn't true for countries: the U.S., for example, has become richer without improving well-being overall.
Hence, researchers have become interested in alternatives—in particular, measuring happiness more systematically (though one recent study claims it's nearly impossible to create an economy based on happiness). The Organization for Economic Cooperation and Development now produces a Better Life Index, while Bhutan—a great advocate for happiness research—publishes a "gross national happiness" index.
The second United Nations World Happiness Report provides another snapshot, both ranking countries for happiness and delving into the factors that promote and hinder happiness. This year's report finds that Denmark, Norway, Switzerland, the Netherlands, and Sweden are the happiest countries, while the United States ranks 17th out of 156 countries. A string of African countries are at the bottom of the list, including Togo, Benin, and Burundi—along with some other countries, like Bulgaria (144th place) and Georgia (134th).
The report ranks the countries across six categories: GDP per head, "healthy life expectancy," "having someone to count on," "perceived freedom to make life choices," freedom from corruption, and prevalence of generosity. Each country gets a score out of 10, with Denmark achieving 7.7, and the average being 5.1. Togo, at the bottom, has 2.9.
The U.N. published a similar study last year, covering the years between 2005 to 2011; the latest report looks at 2010 to 2012. The good news: happiness has improved in 60 out of 130 countries. The bad news: it has worsened in 41 (some couldn't be compared from last time). The United States had a slight decline in its happiness number (minus 0.283)—about the same fall as Japan, Hungary, and Finland. Egypt and Greece saw the biggest drops of all, presumably because of political unrest in Egypt and economic woes in Greece.
Happiness gains were most common in Sub-Saharan Africa and Latin America. Two-thirds of South Asian countries experienced decreases. Europe was split: six of 17 countries had increases, but seven had decreases (including Portugal, Italy, Spain, and Greece, which were hit by the financial crisis). Happiness was down in much of the Middle East and North Africa.
The report postulates that happiness is desirable not only as an end goal but also because it has beneficial side-effects—namely, that happier citizens are more productive, live longer, earn more, and contribute more to society. For that reason, the authors write, governments should invest as much in mental health and public services as they do in promoting economic growth.
The OECD also scores European countries highly for happiness. Sweden, Norway, Switzerland, Denmark, and the Netherlands are also in its top 10 (Australia is first). Meanwhile, the Happy Planet Index, produced by the U.K.'s New Economics Foundation, has Costa Rica, Vietnam, and Colombia as the top three. That report, however, focuses more on environmental impact than the other indexes.