New Metrics

Norway Earns Top Spot in 2017 World Happiness Report

By Libby MacCarthy | Published 7 years ago | About a 4 minute read

With its narrow economic focus, GDP has long been considered a poor measure of human welfare and progress. Several alternatives have been developed over the years to more accurately measure the well-being of a population, including Gross National Happiness (GNH), which uses the collective happiness of a nation as its main development indicator. In its fifth year, the World Happiness Report uses this metric to rank 155 countries, with the ultimate goal of helping governments, organizations and civil society with policy-making decisions.

“The World Happiness Report continues to draw global attention around the need to create sound policy for what matters most to people — their well-being,” said Jeffrey Sachs, director of the UN’s Sustainable Development Solutions Network, the organization behind the report. “As demonstrated by many countries, this report gives evidence that happiness is a result of creating strong social foundations. It’s time to build social trust and healthy lives, not guns or walls. Let’s hold our leaders to this fact.”

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SB'17 DetroitJumping three spots from last year and displacing Denmark, Norway took over as happiest country. Filling out the rest of the top ten in order are Denmark, Iceland, Switzerland, Finland, Netherlands, Canada, New Zealand, Australia and Sweden. The U.S. came in at number 14, dropping down one spot from last year.

Norway’s consistent high ranking can — to some extent — be contributed to its approach to its oil industry. By choosing to produce oil slowly and investing the proceeds for the future, Norway has managed to insulate itself from the boom and bust cycle of many other resource-rich economies. For such an approach to be successful, a high level of mutual trust, shared purpose, generosity and good governance are required — factors that have ultimately helped Norway, along with other top countries, maintain a high happiness ranking.

Declining support and increased corruption are attributed to the U.S.’s fall in the rankings, while unemployment and fraying social safety nets are identified as the sources of dropping happiness during the period between 1990 – 2005 in China, though recent data has shown slight improvements in both areas since. Africa, on the other hand, tells a much more diverse story, though happiness is less evident on the continent as a whole than in other regions of the world.

This year, the World Happiness Report gives special attention to the social foundations of happiness, including happiness in the workplace. “People tend to spend the majority of their lives working, so it is important to understand the role that employment and unemployment play in shaping happiness,” said Professor Jan-Emmanuel De Neve, Saïd Business School, University of Oxford.

“The research reveals that happiness differs considerably across employment status, job type and industry sectors. People in well-paid roles are happier, but money is only one predictive measure of happiness — work-life balance, job variety and the level of autonomy are other significant drivers. There is a clear distinction in happiness between white and blue collar jobs, with managers or professionals evaluating the quality of their lives at a much higher level than those in manual labor jobs even controlling for any possible confounding factors.”

Personal factors affecting happiness were also taken to account in the report. According to Professor Richard Layard, mental illness was the single most significant cause of misery in wealthy countries.

The World Happiness Report 2017 examines trends in the data recording how highly people evaluate their lives on a scale running from 0 to 10. The rankings, which are based on surveys in 155 countries covering the three years 2014 – 2016, reveal an average score of 5.3 (out of 10). Six key variables explain three-quarters of the variation in annual national average scores over time and among countries: real GDP per capita, healthy life expectancy, having someone to count on, perceived freedom to make life choices, freedom from corruption and generosity.