Why Happiness Is Important

by |April 23, 2015
Happy Tibetan Buddhist monk

The report reminds people and policy makers, happiness is based on social capital, not just financial capital.

The World Happiness Report 2015, launched by the Sustainable Development Solutions Network (SDSN), measures and ranks the happiness of individuals in 158 countries around the globe. Why happiness? Because happiness is increasingly considered an important and useful way to guide public policy and measure its effectiveness.

The first World Happiness Report was published in 2012, based on Gallup World Poll data from 2005 to 2011 from 156 countries. The second one, produced under the auspices of the SDSN, covered 2010 to 2012 and noted changes from the first report. More and more, local and national governments are using the data on happiness to shape policies that enhance the lives of their citizens.

The 2015 report was edited by Jeffrey Sachs, director of the Earth Institute and the Sustainable Development Solutions Network; John F. Helliwell from the University of British Columbia and the Canadian Institute for Advanced Research; and Richard Layard, director of the Well-Being Programme at The London School of Economics’ Centre for Economic Performance.

The report incorporates analysis by experts in economics, neuroscience and statistics, and shows how measurements of well-being can be used to evaluate a country’s progress. General assessments of individuals’ whole lives as well as data about their emotional experiences were collected and considered.

The happiness ranking of countries was determined by asking individuals to evaluate their lives as a whole, according to six variables. Respondents scored them on a scale of 0 to 10.

  1. GDP per capita, i.e. purchasing power
  2. Social support (having someone to count on in troubled times)
  3. Healthy life expectancy,
  4. Freedom to make life decisions,
  5. Generosity (donations to charity)
  6. Perceptions of corruption
Young people in Zurich, Switzerland. Photo: marketer

Switzerland takes top spot as happiest country. Photo: morktor

The top 10 happiest countries in order are: Switzerland, Iceland, Denmark, Norway, Canada, Finland, Netherlands, Sweden, New Zealand and Australia. The United States comes in at #15.

The unhappiest 10 are: Central African Republic, Chad, Guinea, Ivory Coast, Burkina Faso, Afghanistan, Rwanda, Benin, Syria, Burundi, with Togo in last place.

The life evaluations of the top 10 on average are more than twice as high as the bottom 10, with GDP per capita over 25 times higher in the top 10 than in the bottom 10. In addition to having low scores on all six variables, the bottom 10 are also often plagued by more violence and disease.

“Higher income countries tend to score higher, but the differences of income do not explain all that much across countries,” said Sachs. “The state of health, both physical and mental, is also very important in explaining differences. But a third aspect that is really important is the quality of society…sometimes called social capital—Do we trust each other? Do we have social support networks? Do we trust government and business to be honest? Social capital is hugely important in explaining the differences across countries in well-being.”

Life evaluations gathered from 2005 to 2007 were compared to those from 2012-2014 to see how countries dealt with crises. The countries best able to weather the 2008 global recession had the strongest social fabric, characterized by trust and strong social institutions. These factors enabled some countries to better provide for their citizens as well as to find collaborative solutions to their problems.

When a country’s social fabric is strong, feelings of well-being can grow because people work together to solve problems and appreciate the social support they have. For example, Iceland and Ireland both suffered decimation of their banking systems during the financial crisis, but emerged unscathed because both countries scored highest in terms of having someone to count on in a crisis. And despite the 2011 Fukushima nuclear disaster, Japan’s happiness and trust increased after the crisis brought out the mutual support and cooperation of its people.

Greek demonstrator. Photo: GeorgeLaoutaris

Greek demonstrator. Photo: GeorgeLaoutaris

On the other hand, if social institutions fail to meet the challenges of a crisis, individuals can become even unhappier, because they lose social trust. Greece was hard hit by the recession and was one of the countries that lost the most happiness between the two periods, because its social institutions crumbled under the pressure.

In a parallel analysis by age, gender and regions, emotional experiences of happiness, enjoyment, laughter, feeling rested, feeling safe at night, and how much interest in their lives people had were measured. Anger, worry, sadness, depression, stress and pain were also tracked. Around the world, life evaluations vary more than happiness because they are influenced by the six variables. Generally, though, happiness goes down as people age, particularly for females. Negative experiences are much more varied among age groups and gender; however, women everywhere feel pain, sadness and depression more frequently than men, especially as they age.

The editors hope that policy makers will make good use of this data. “Our argument is that policy makers should be making the happiness of their people the goal of their policies. This is not a new idea. It is the central idea of the founding fathers of the United States,” said Layard.

To shape policy with data about happiness and well-being, the report suggests that a cost-benefit analysis be done ranking all potential policies according to the amount of happiness they might produce per dollar spent. Many complex variables would need to be considered to do this; for example: How does a policy affect different people, should policies initially help the most miserable, how do you assess policies that make a long-term difference, how do you evaluate longer life spans, are young lives more important than older lives? Benefits could also conceivably be calculated just in terms of money, because expenditures for education, employment, industry and transport offer direct and indirect benefits to individuals. Being able to implement specific policies on a scientific basis, however, will require much more research and controlled experiments.

An examination of the neuroscience of happiness found that four key components of well-being—positive emotion, resilience, empathy, and paying attention—are malleable and can thus be shaped by training and education. In other words, certain aspects of happiness and well-being are actually skills that can be learned.

Photo: grahamcrumb

Photo: grahamcrumb

The report considered the well-being of children, since almost one-third of the world’s population is under 18, 10 percent of which have mental problems such as anxiety, depression, ADD and ADHD. Since most of these disturbed children will likely grow up to become unhappy or mentally ill adults, it is important to understand how to prevent the development of mental problems early on. Some of the policies advocated include increased community awareness of mental health, improved healthcare that is available to all, well-being policies for schools, and the teaching of life skills.

The top 10 happiest countries, characterized by high degrees of social capital, enjoy more economic health and an enhanced sense of well-being because their citizens are more likely to sacrifice for the greater good and to behave in pro-social ways, such as paying taxes, investing in public infrastructure and supporting social safety net policies. The most pro-social countries (Denmark, Norway and Sweden) have high civic participation, homogeneity, social and economic equality, levels of social trust and little public corruption.

High-ranking countries also appear to be the greenest countries, though sustainability was not a factor measured in this report. “They also happen to be the coldest countries,” said Helliwell, “and a harsh climate is precisely where you have to develop the capacity to cooperate and collaborate or you won’t survive… They are greener because their governments think about each other, and that often extends to a broader social identity, so among those countries you’ll find key contributors to global efforts of various kinds, whether it’s peace-keeping or environmental improvement.”

Unfortunately, the U.S. has sharply declined in social capital since 1980. This is attributed to growing income equality, increased ethnic heterogeneity due to immigration, the adoption of more libertarian political policies and declining trust in government.

Why one society has strong social capital while another does not remains a mystery, but there are ways to actively promote social capital. The report’s recommendations include: Provide moral training in school, universal access to education and specialized training in compassion; establish codes of ethics for different professions and governmental regulations against anti-social behavior; reduce corruption and income equality, and adopt strong social safety nets.

Photo: DonMacauley

Photo: DonMacauley

Marking the United Nation’s 70th anniversary in September, all 193 governments of the U.N. will adopt the Sustainable Development Goals to guide the world over the next 15 years towards a more sustainable future. Sustainable development is considered the ability of a country to balance and integrate economic, social and environmental objectives; and individuals in countries that aspire to sustainable development generally have a greater sense of well-being. The SDSN is recommending to the U.N. General Assembly that measures of well-being and happiness be included as gauges to help chart progress towards the Sustainable Development Goals.

“We have to pay attention to the strength of society as well as the strength of economies if we’re going to be able to pursue well-being,” concluded Sachs.


One thought on “Why Happiness Is Important

  1. Lee says:

    Smart essay on an interesting report. Who thought you could quantify happiness?

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