The report takes into account the GDP per capita, life expectancy, social support and freedom to make life choices as indicators of happiness.
An index of changes from 2005-07 to 2014-16 shows that Nicaragua is the most improved country in happiness, followed by Latvia and Sierra Leone.
"Happy countries are the ones that have a healthy balance of prosperity, as conventionally measured, and social capital, meaning a high degree of trust in a society, low inequality and confidence in government", Jeffrey Sachs, the director of the SDSN and a special advisor to the United Nations Secretary-General, said.
In the latest UN World Happiness Report released Monday, Algeria is in the lead, followed by Mauritius, while Libya comes in third place.
They found that receiving a diagnosis for a mental illness contributes more to a person's happiness than income, employment or a diagnosed physical illness.
That's according to the fifth annual United NationsWorld Happiness Report.
Researchers say six key factors affect each country's happiness score: income, life expectancy, freedom, generosity, corruption and social support among the community.
In order, the biggest improvements of happiness levels over the past year came from Nicaragua, Latvia, Sierra Leone, Ecuador, Moldova, Bulgaria, Russia, Slovakia, Chile, and Uzbekistan. Pakistan also ranks ahead of several countries that are much more technologically advanced, including Greece and South Africa.
Other Scandinavian countries also scored better than the USA, despite slightly worse economies. The data also shows that rising unemployment negatively affects everyone, even those still employed.
Central African Republic fell to last on the happiness list and is joined at the bottom by Burundi, Tanzania, Syria and Rwanda. While the building blocks of a satisfying life are universal, happiness levels vary from country to country.
Of course, happiness is both a personal and a social thing. "In every country physical health is of course also important, but in no country is it more important than mental health", the report states. "The top of the ladder represents the best possible life for you and the bottom of the ladder represents the worst possible life for you".
As for our fair country, it rang in at 14th on this year's list, one spot lower than in 2016.
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