Mental health key to national happiness:

If governments want their people to be happy, they should focus on mental health first and foremost according to a new report on the world’s happiness from Columbia University’s Earth Institute.

“Mental health or psychological well-being makes up an integral part of an individual’s capacity to lead a fulfilling life,” writes Richard Layard, one of the lead author’s of the report, and Emeritus Professor of Economics at the London School of Economics.

Governments that wish to improve the happiness of their populations should spend a higher proportion of their health budgets on mental illness, which is the single biggest "determinant of misery" in countries assessed.

This was the case in Australia as well as other countries. The report shows that mental health problems are more than three times more likely than physical health problems to affect how miserable someone feels in Australia, and almost six times more likely than being unemployed.

"People can be unhappy for many reasons - from poverty to unemployment to family breakdown to physical illness. But in any particular society, chronic mental illness is a highly influential cause of misery.

"If we want a happier world, we need a completely new deal on mental health."

Who’s happiest

Not that Australia fares too badly. Overall, we’re ranked 10^th but if you’re looking for greater satisfaction in life, you should probably start in northern Europe. Six out of the top 10 happiest nations are in northern Europe, two in central Europe and two outliers – Canada and Australia. In order, they are:

1. Denmark
2. Norway
3. Switzerland
4. Netherlands
5. Sweden
6. Canada
7. Finland
8. Austria
9. Iceland
10. Australia.

It’s probably no surprise to hear that we should steer clear of Egypt and countries worst hit by the Eurozone crisis, as well as many of the nations in sub-Saharan Africa such as Rwanda, Burundi, the Central African Republic, Benin and Togo.

Of our near neighbours, New Zealand was ranked highest at 13^th and Indonesia was 76^th. Timor and PNG are not included.

Other notable rankings are:

• Israel – 11^th
• United Arab Emirates – 14^th
• USA – 17^th
• Germany – 26^th
• Ireland – 18^th
• United Kingdom – 22^nd
• and Brazil, France, Germany, Qatar in 24-27^th positions respectively.

Rankings for Greece, Italy, Portugal and Spain fell dramatically because of the impact of the Eurozone crisis, while Egypt, Myanmar and Saudi Arabia registered large falls in the wake of political and civil turmoil.

Gross National Happiness

The 2013 World Happiness Report comes on the back of a growing global movement calling for governments and policy makers to reduce their emphasis on achieving economic growth and focus on policies that can improve people's overall well-being.

The concept of “happiness economics” was first proposed in 1972 by Bhutan's former King Jigme Singye Wangchuck, and has now gained traction in many countries across the world, including the UK, Germany and South Korea. The UN first encouraged member countries to measure and use the happiness of their people to guide public policies in July 2011.

"It is important to balance economic measures of societal progress with measures of subjective well-being to ensure that economic progress leads to broad improvements across life domains, not just greater economic capacity," the report said.