Research on what affects the levels of happiness of an individual, organization or country has been growing across different academic fields because of its importance to managers, business leaders and policy makers alike. The relationship between different measurements of income and happiness is multi-faceted. We presented this complexity in a chart recently. In this edition of the Criterion of the Month we explore how other important measures of The IMD World Competitiveness Ranking are related to the happiness of an economy.
Let’s begin by exploring the correlation between Happiness and Quality of Life. The vertical axis in Graph 1 presents the values from the 2018 UN World Happiness Report. The horizontal axis shows the IMD Executive Opinion Survey answers by mid- and upper- level business executives as to whether the quality of life is high in their country of residence. There is a strong positive relation with a correlation coefficient equal to 0.8 – the countries with high levels of subjective quality of life are also the countries that exhibit high levels of happiness.
