Exploring the Relationship Between Happiness and Intelligence

Happiness is more difficult to define than it would seem at first blush. It’s even more difficult to quantify, and it can also be difficult to achieve with so many competing interests and emotions.

We all want to be happy, though, so we study what makes people happy and what doesn’t. We try to apply the lessons learned to our lives, adding kittens, removing alligators, and trying to spend in a way that will bring us joy.

I’ve studied the World Happiness Report, claimed that happiness is an early retirement, and explored the economics of happiness. One thing I hadn’t considered is the relationship between intelligence and happiness.

Sam Dogen digs into the data for us. This Friday Feature was originally published on Financial Samurai.

 

 

Being smart is generally a good thing. You can use your smarts to make more money and do more things with ease. However, what if you live in one of the smartest countries in the world? Can your smartness shine through when many of your peers are equally as intelligent?

Or what if you live in one of the happiest countries in the world? If you’re not always happy, will you feel like there’s something wrong with you? Surely, there are some unhappy people living in Norway and Sweden, two countries that consistently rank in the top 5 happiest countries in the world.

 

The Smartest Countries In The World

 

In a 2002 to 2006 study, British professor Richard Lynn measured the IQ of citizens of more than 80 countries. He found that people from Singapore and Hong Kong came out on top, followed by South Korea, Japan, China, Taiwan, and Italy as the top seven countries.

Below is a list of the smartest countries in the world as measured by average IQ number. Notice how the United States is missing from this list.

 

 

Average IQ By Country

 

The United States has an average IQ of 98, which puts it just below the average IQ in the world of 98.36. You would think that with all our wealth and fancy universities, Americans would have a higher average IQ.

Except for schools like Oxford, Cambridge, INSEAD, Beijing University, Tokyo University, and the Indian Institute of Technology, I don’t know many other foreign universities that are as well-regarded as our top 25 universities in America.

 

 

Just as the SAT or ACT exam used to test student abilities may contain culturally biased content, so could IQ testing. Giving the same test to people from widely differing communities fails to take different cultural values into account. It also does not recognize what different communities consider intelligent behavior.

The Organization for Economic Cooperation and Development did its own smartest nations study, using adult education level as a key variable. It determined Canada (99 IQ average) was the most intelligent nation. Japan (105 IQ) placed second, while Israel (95 IQ) came in third.

Other high-ranking nations included Korea (106 IQ), the United Kingdom (100 IQ), the United States (98 IQ), Australia (98 IQ), and Finland (99 IQ).

 

The Happiest Countries In The World

 

Now let’s take a look at the happiest countries in the world.

Since 2002, the World Happiness Report has used statistical analysis to determine the world’s happiest countries.

To determine the world’s happiest country, researchers analyzed comprehensive Gallup polling data from 149 countries for the past three years, specifically monitoring performance in six particular categories:

• Gross domestic product per capita
• Social support
• Healthy life expectancy
• Freedom to make your own life choices
• Generosity of the general population
• Perceptions of internal and external corruption levels

 

For 2021, the top seven happiest countries in the world were all Northern European Countries: Finland, Denmark, Switzerland, Iceland, Netherlands, Norway, and Sweden. Rounding out the top 10 are New Zealand (8), Austria (9), and Luxembourg (10). Canada, the OECD’s smartest nation, just missed the cut at 11.

Meanwhile, the least happy country in the world for 2021 was Afghanistan, whose 149th-place ranking of 2.523 can be attributed in part to a low life expectancy rate and low gross domestic product rates per capita. After the Taliban took over Kabul in August 2021, I suspect the country’s overall happiness ticked down even further.

 

 

The Smartest Countries Are Not The Happiest Countries

 

The World Happiness Report is also subjective. For example, the Editors of the 2020 report were John F. Helliwell (Canadian economist at CIFAR), Richard Layard (British labor economist at LSE), Jeffrey D. Sachs (American economist at Columbia), and Jan-Emmanuel De Neve (Belgian economist at Oxford). Where are the editors from Africa or Asia?

Therefore, it is easy to assume how the editors might show some preferences towards Europe, America, and Canada. It’s human nature to be biased towards what and who we know best. We can never truly know about other cultures unless we speak their languages and live in their countries for years.

But let’s pretend for a moment these editors from Anglo-Saxon countries all have zero biases. Below are the happiness rankings for the top six smartest countries in the world

 

1. Singapore – Happiness rank #31
2. Hong Kong – Happiness rank #78
3. South Korea – Happiness rank #61
4. Japan – Happiness rank #62
5. China – Happiness rank #94
6. Taiwan – Happiness rank #25

 

It sure seems like there is little correlation between how smart you are and how happy you are. People in Hong Kong, China, and South Korea have it particularly bad, being so smart, yet so down on the happiness rankings chart. The best showings are from Taiwan and Singapore.

 

 

 

Why The Smartest Countries Aren’t Happier?

 

I lived in Taiwan for four years, Malaysia for four years, Japan for two years, and China for six months. I also visited Hong Kong over 20 times, visited Singapore over 10 times, and visited South Korea two times. During this time, I met plenty of happy people.

I’ve never come across a Singaporean and thought they were a genius, perhaps due to the Singlish accent. But I have met plenty of Indians who were very intellectually intimidating at work and while I was getting my MBA.

I could write a book about my experiences in these countries. However, let me surmise the reasons why some people from these smart countries aren’t happier.

1. Especially crowded in Japan, China, and Hong Kong
2. Pollution, especially in China, followed by Taiwan, and South Korea
3. Extremely expensive real estate in Hong Kong, Singapore, South Korea, and China versus cheap U.S. real estate
4. Low wages relative to housing costs
5. Long work hours, especially in Japan, China, and South Korea
6. Later family formation due to high cost of living relative to wages
7. An obsessive focus on capitalism
8. No Asian people from the smartest nations on the World Happiness Report editorial board to provide perspective
9. Gap between rich and poor feels too large (Squid Game on Netflix captures this mood in South Korea)

 

Different Ways Of Life

In the smartest countries in the world, it is common for adult children to live at home with their parents until they get married and start families. Therefore, it is possible a lack of independence due to financial constraints is also keeping happiness down.

That said, having strong family relationships is a huge part of Asian culture. Being able to take care of your parents is an honor. Grandparents also being able to see and take care of their grandchildren, sometimes all under one roof, is also a positive.

Therefore, if the World Happiness Report were to use Family Cohesiveness as a happiness variable, Asian countries would likely shoot to the top.

Every time I visited one of these countries for work, I marveled at how focused people were on making money. Working past 7 pm and on weekends was commonplace. Perhaps due to a strong work culture, citizens of these smart countries don’t feel like they can relax as often. Competition to get ahead is too fierce.

Whereas if you go to the happiest countries in the world, people are much more relaxed about work. Instead of living to work, they seem to be more about working to live. Further, there is a smaller gap between the rich and poor.

Therefore, as the smartest countries get wealthier, they should get happier as well. There will no longer be as much need to work long hours to try and get ahead. When you are richer, you naturally become nicer as well. There’s simply less insecurity and jealousy when you have more money.

 

 

Worth Moving To A Happiest Country?

 

Even though the smartest countries in the world supposedly aren’t the happiest, the happiest countries in the world are also some of the smartest. For example, Switzerland, Luxembourg, Austria, Norway, Netherlands, and Finland are also some of the top 20 richest countries. Therefore, you might try to live in one of these countries for a better life.

One of my favorite cities in Europe is Amsterdam. It reminds me of a more laid-back San Francisco. I could definitely live in Amsterdam for a couple of years. However, I’m not fond of cold weather for four months of the year. Therefore, it’s a hard pass for me living in one of the Northern European countries for the long term.

As for living in one of the smartest countries, I feel like Singapore and Taipei, Taiwan offer the best environments for families. Singapore is very expensive, but the food is amazing. The country is safe, and international grade schools are good.

Taipei also has amazing food and a good American school. The people are friendly and the cost of living is relatively low. The per capita GDP is about $32,000 and provides for about $59,300 in purchasing power parity. I’d love for both my children to become fluent in Mandarin.

It’s not worth moving to one of the happiest countries to gain more happiness. You can find plenty of happiness where you currently live.

Related: The Proper Geoarbitrage Strategy: Your City, Your Country, Then The World

 

America Is Still The Best

 

After all my travels (60+ countries), America is still the best place in the world to live. We may not be the smartest or happiest country, but our country sure does provide a lot of opportunities. America has anything for anybody willing to look hard enough.

Further, we all have the opportunity to get smarter and happier if we want. Getting smarter is pretty straightforward. We just need to read, listen, and learn more from people who are smarter than us. Then we need to take action and constantly learn from our mistakes.

Getting happier is a little trickier. However, more knowledge generally provides more happiness. Having enough money to do what you want improves happiness. Doing something purposeful brings greater meaning to one’s life. Finally, having supportive friends and loved ones are vital for happiness.

Personally, I give myself a 7-8 out of 10 on a subjective happiness scale. I was closer to a 5-6 out of 10 while working. It is really the freedom to do what I want that makes me the happiest. I’m sure most others who have gained more freedom feel the same.