Finland was ranked the happiest nation in the world once again, as per the World Happiness Report, released annually. It marked Finland's eighth consecutive year in the top spot, released on the United Nations' International Day of Happiness. Finnish citizens posted an average life satisfaction score of 7.74 out of 10, according to Fortune.

Jan-Emmanuel De Neve, the University of Oxford economics professor and report editor, described why Finland remains at the top. “They’re wealthy, they’re healthy, have social connections, social support, [and] a connection with nature,” De Neve said. “They’re not happy, joyful, dancing in the streets type people, but they’re very content with their lives.”

Nordic countries head the list

Nordic nations have again ruled the top ranks. Denmark, Iceland, Sweden, and the Netherlands occupied the next four places following Finland. Other nations that found a place in the top 10 are Costa Rica (6th), Norway (7th), Israel (8th), Luxembourg (9th), and Mexico (10th).

Notably, Costa Rica and Mexico joined the top 10 for the first time this year. In contrast, the United States fell to 24th place, a record low.

Full top 10 list:

  1. Finland
  2. Denmark
  3. Iceland
  4. Sweden
  5. Netherlands
  6. Costa Rica
  7. Norway
  8. Israel
  9. Luxembourg
  10. Mexico

Why are Nordic countries so happy?

The report emphasized that the level of social trust and economic equality play a major role in the level of happiness. De Neve remarked that although countries such as the U.S., Australia, and the U.K. have comparable GDP per capita to Norway and Sweden, the rich-poor divide is significantly higher in these nations.

“In these Nordic Scandinavian countries, a rising tide lifts all boats, so the levels of economic inequality are much less, and that reflects in well-being as well,” De Neve explained. He added that in Finland, most people rate their happiness between seven and eight, while in the U.S., there are more extreme ratings of both one and ten.

Aside from finances, social trust and human relationships also play a role in happiness. The study discovered that citizens of Nordic countries are more apt to anticipate getting back lost wallets — and mostly, they do.

“The more you believe in the kindness of others, or in other words, are socially trusting, the higher your individual well-being and the higher collective well-being,” De Neve said. “The Nordic countries, the Scandinavian countries, do better, both in the belief in others’ kindness and in the actual wallet drop.”

Latin America's rise in happiness

Strong social connections in Costa Rica and Mexico have placed them in the top 10. Residents of both countries reported the highest shares of meals consumed per week, as well as high levels of community trust.

Nonetheless, the report stated that the COVID-19 pandemic led to a sharp decline in happiness levels in Latin American countries because of social isolation. Regardless of this, their strong community bonds have been able to see them bounce back.

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