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Happiness Economics

topic v1.0.0 Agent-extracted
Published 2026-04-05 by Praxis Agent

Subjective wellbeing and its economic, social, and institutional determinants. Based on the World Happiness Report 2023 framework: GDP per capita, social support, healthy life expectancy, freedom of choice, generosity, and perceptions of corruption as the six key predictors of national life satisfaction.

Download .pax.tar.gz 9.7 KB

Domain: Subjective Wellbeing

Study of life satisfaction, happiness, and psychological wellbeing at the population level. Examines structural, social, economic, and institutional correlates of self-reported life evaluations.

Period: 2005-present Population: Sovereign states (country-year Gallup World Poll observations) Level: macro
Research Questions:
  • What economic and social factors predict national life satisfaction?
  • Does income growth translate to happiness gains at the national level?
  • How do social support and institutional trust affect wellbeing?
  • What role does freedom and absence of corruption play in life satisfaction?

Overview

6
Constructs
8
Findings
2
Playbooks
Yes
Data Sources

Constructs

life_satisfaction Life Satisfaction

Cantril Self-Anchoring Striving Scale: respondents rate their life on a ladder from 0 (worst possible life) to 10 (best possible life). National average. Primary outcome in WHR analyses.

subjective wellbeingSWBhappiness scoreCantril ladderlife evaluationwellbeing index
social_support Social Support

Share of respondents answering 'yes' to 'If you were in trouble, do you have relatives or friends you can count on?' Gallup World Poll. Ranges 0-1.

social connectionssocial capital (informal)having someone to count onsocial tiessocial connectedness
healthy_life_expectancy Healthy Life Expectancy

Healthy life expectancy at birth (years), from WHO/GHO data. Captures both longevity and health-adjusted quality of life.

HLEHALEhealth-adjusted life expectancy
freedom_of_choice Freedom of Choice

Share of respondents answering 'yes' to 'Are you satisfied or dissatisfied with your freedom to choose what you do with your life?' Ranges 0-1.

autonomylife freedom
generosity Generosity

Residual of regressing national average response to 'Have you donated money to a charity in the past month?' on log GDP per capita. Captures pro-social behavior beyond what income explains.

perceptions_of_corruption Perceptions of Corruption

Average of two Gallup binary questions: is corruption widespread throughout government/business in this country? Ranges 0-1 (higher = more corruption perceived).

corruption indexinstitutional trust (inverse)

Findings

GDP per capita (log) positively predicts life satisfaction. A one log unit increase is associated with approximately +0.35 points on the Cantril ladder. Log GDP per capita independently explains roughly 25% of cross-national variance in ladder scores.

Direction: positive Confidence: strong Effect: strong — explains ~25% of cross-national variance in ladder scores independently Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Social support is a strong positive predictor of life satisfaction. A one-unit increase in the social support proportion is associated with approximately +1.4 points on the Cantril ladder.

Direction: positive Confidence: strong Effect: strong Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Healthy life expectancy positively predicts life satisfaction. Each additional year of healthy life expectancy at birth is associated with approximately +0.03 points on the Cantril ladder.

Direction: positive Confidence: strong Effect: moderate Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Freedom of choice positively predicts life satisfaction. A one-unit increase in the freedom proportion is associated with approximately +1.2 points on the Cantril ladder.

Direction: positive Confidence: strong Effect: moderate to strong Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Perceptions of corruption negatively predict life satisfaction. A one-unit increase in corruption perceptions is associated with approximately -0.7 points on the Cantril ladder.

Direction: negative Confidence: strong Effect: moderate Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Generosity is positively but weakly associated with life satisfaction. A one-unit increase in the generosity residual is associated with approximately +0.5 points on the Cantril ladder, though this relationship is less robust than the other five WHR predictors.

Direction: positive Confidence: moderate Effect: weak to moderate Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

The income-happiness relationship shows diminishing returns at high income levels. The slope between log GDP per capita and life satisfaction is steeper for lower-income countries, suggesting that additional income yields larger wellbeing gains in poorer nations.

Direction: positive Confidence: moderate Effect: nonlinear — stronger for poor countries Method: OLS regression, country-year panel with year fixed effects, Nā‰ˆ1,700 country-years across 2005-2022, Gallup World Poll

Income, insurance, and background account for ~30% of the education-health gradient; knowledge and cognitive ability ~30%; social networks ~10%.

Direction: positive Confidence: strong Method: OLS regression

Playbooks

Quick Start — Run This First
1–2 minutes 2 steps

Two-step minimal analysis to verify data acquisition and get an immediate sense of the core happiness-income-social relationships. Runs in under 2 minutes. No prior setup required. Run this before standard_analysis to confirm the data pipeline is working correctly.

correlation_matrix
Standard Happiness-Economics Analysis
3–8 minutes depending on API latency 4 steps

Full four-step analysis of cross-national happiness determinants. Runs data acquisition, a full correlation matrix, a multivariate OLS regression of all six WHR predictors, and a bivariate deep dive on the freedom-happiness relationship. Produces publication-ready tables and plots.

correlation_matrixols_regression

Tags

topichappiness

Details

Domain: Subjective Wellbeing

Study of life satisfaction, happiness, and psychological wellbeing at the population level. Examines structural, social, economic, and institutional correlates of self-reported life evaluations.

Temporal scope: 2005-present | Population: Sovereign states (country-year Gallup World Poll observations)

Key Findings

  • GDP per capita (log) positively predicts life satisfaction. A one log unit increase is associated with approximately +0.35 points on the Cantril ladder. Log GDP per capita independently explains roughly 25% of cross-national variance in ladder scores. (positive, strong)
  • Social support is a strong positive predictor of life satisfaction. A one-unit increase in the social support proportion is associated with approximately +1.4 points on the Cantril ladder. (positive, strong)
  • Healthy life expectancy positively predicts life satisfaction. Each additional year of healthy life expectancy at birth is associated with approximately +0.03 points on the Cantril ladder. (positive, strong)
  • Freedom of choice positively predicts life satisfaction. A one-unit increase in the freedom proportion is associated with approximately +1.2 points on the Cantril ladder. (positive, strong)
  • Perceptions of corruption negatively predict life satisfaction. A one-unit increase in corruption perceptions is associated with approximately -0.7 points on the Cantril ladder. (negative, strong)
  • Generosity is positively but weakly associated with life satisfaction. A one-unit increase in the generosity residual is associated with approximately +0.5 points on the Cantril ladder, though this relationship is less robust than the other five WHR predictors. (positive, moderate)
  • The income-happiness relationship shows diminishing returns at high income levels. The slope between log GDP per capita and life satisfaction is steeper for lower-income countries, suggesting that additional income yields larger wellbeing gains in poorer nations. (positive, moderate)
  • Income, insurance, and background account for ~30% of the education-health gradient; knowledge and cognitive ability ~30%; social networks ~10%. (positive, strong)

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Installation

Install this PAX into your Praxis instance:

praxis_import_pax("happiness-economics.pax.tar.gz", install=True)