Happiness is hard or maybe even impossible to truly measure. Yet every year, researchers try to do it anyway. The World Happiness Report, an annual ranking that crunches vast amounts of Gallup polling data, has once again crowned Finland the happiest country on Earth.
The 2025 rankings tell an intriguing story: Nordic countries dominate, the US has fallen to its lowest-ever position, and inequality is an important driver of unhappiness. But why?
Public trust matters a lot
Good weather only gets you so far. Nordic countries (Finland, Norway, and Denmark) constantly rank high in the happiness charts. Finland has now topped the chart for ten years in a row and Iceland is no stranger to the podium either. Even Sweden, the “laggard” in sixth place, is now in 4th position. Nine out of the top ten countries were European, with the sole exception being Israel.
At the bottom of the World Happiness Report 2025 are Afghanistan, Lebanon, Lesotho, Sierra Leone, and the Democratic Republic of Congo—countries where hardship is a constant of daily life. Afghanistan, ranked dead last with a score of just 1.721, continues to suffer from political collapse, widespread poverty, and repression under Taliban rule. For Afghan women, in particular, life has become extremely difficult.
Lebanon’s economic implosion, coupled with rampant corruption and a paralyzed government, has decimated public trust. In fact, public trust and strong public institutions seem to be strongly correlated with happiness. Finnish and Nordic people constantly express their trust in institutions and society in general. Simply put, corruption kills happiness. Nations with transparent, functioning governments rank higher than those plagued by scandal and inefficiency.
Meanwhile, the US continues to drop. After peaking at 11th in 2012, after the first Obama term, the US has constantly dropped. Now, the country is ranked 24th, its lowest-ever position. It’s not coincidental that the country reports record low trust in institutions.
Wealth and inequality
The World Happiness Report calculates its rankings using a three-year average of Gallup World Poll data from over 140 countries, focusing on six key variables that contribute to well-being: GDP per capita, social support, healthy life expectancy, freedom to make life choices, generosity, and perceptions of corruption.
To make comparisons across nations meaningful, researchers create a hypothetical “Dystopia”—a country with the lowest values in all six categories—and then measure how much each real country rises above that baseline. The higher a country scores in each factor, the more its citizens report life satisfaction on a scale from 0 to 10. These adjusted scores are then averaged to produce a final national happiness score.
In most countries, however, scores are falling. Even Finland, the gold standard for happiness, dropped from 7.804 to 7.74. Israel’s decline from 7.473 to 7.34 was more dramatic. A large part of this decrease in happiness can be attributed to inequality, and in the case of Israel, to armed conflict.
Wealth, of course, has some connection to happiness. But wealth alone doesn’t buy happiness. What matters more, after basic needs are covered, is how fairly it’s distributed.
Countries like the US and the UK, which have very high GDPs but also very high inequality, rank in the higher part of the table, but not at the very top. Meanwhile, countries like Sweden or the Netherlands, which have more progressive taxation systems, rank higher. This is consistent with what previous studies have found: social and economic inequality is one of the strongest predictors of where and when democracy erodes and it is also a trigger of unhappiness.
How to make your country happier
We should make an honorable mention of Bhutan. In the 1970s, Bhutan’s king famously stated that “Gross National Happiness is more important than Gross Domestic Product.” Since then, the idea of Gross National Happiness (GNH) has influenced Bhutan’s development policy, with the country focusing on mindfulness and wellbeing of its people. But Gallup doesn’t conduct polling in Bhutan so we’re not sure how well Bhutan is faring on the happiness scale. It’s an interesting social experiment and it could give Nordic countries a run for their money.
But the recipe for happiness isn’t mysterious—it’s backed by decades of research. Here are the core things that seem to make countries happier:
- Invest in Social Infrastructure – Free healthcare and education pay off
- Promote Work-Life Balance – Shorter workweeks and paid leave boost well-being.
- Tackle Inequality – Extreme wealth gaps erode happiness.
- Build Trust in Government – Transparency matters. Corruption makes people unhappy.
- Strengthen Social Connections – A nation thrives when people rely on each other.
Most countries have gradually gotten happier and happier in time, but we could be reaching a turning point. Will global uncertainty make happiness a rarer commodity? Or will countries embrace the principles shown to increase happiness? Time will tell. But one thing is clear—happiness isn’t just about wealth. It’s about security, community, and trust. And for now, Finland remains the gold standard.
