denmark happiest country

Most of us don’t like paying taxes because it is more money out of our pockets.

This can be especially true if we do not believe in the types of policies or programs our tax money is funding. Because of this, you would think that the country with the highest tax rate in the world would have the most miserable people, right?

It turns out that Denmark has the highest tax rate in the world with a 48.9% tax-to-GDP ratio.  In comparison, India’s tax-to-GDP ratio is 10.6%, Japan’s is 27.4%, and the United States is 28.2%.

But there is something else that Denmark is known for: being the happiest country in the world. Isn’t that interesting?

Every year, the Danish work until June 17th in order to pay their tax burden.  In comparison, the United States’ tax freedom day is April 9th. Even though the Danish must work two entire extra months out of the year just to pay their tax burden—half the year in total—they are happier than we are as a whole. In other words, happiness or lack thereof cannot be dictated by the amount of taxes paid (unless it increases the Danish people’s happiness to pay taxes). Happiness also is not dictated by moneyalone either: while Denmark is a wealthy country—Denmark’s 2009 GDP per capita is $55,992—Norway has a much higher GDP per capita of $79,089 and ranked 9th in terms of happiness, not first.

So if both tax burden and GDP are not indicators of happiness, then what are?

Main Indicators of Happiness

It turns out there are several different ways to quantify the happiness of a nation. In 2006 the University of Leicester undertook a study that combined both economics and psychology in order to find out which countries were the happiest in the world. Analysis showed that “a nation's level of happiness was most closely associated with health levels (correlation of .62), followed by wealth (.52), and then provision of education (.51)”. Denmark ranked No. 1, and the United States came in at 23rd on the world’s first ever “World Map of Happiness”.

This study was followed by a University of Cambridge study in 2007 that showed the Danish as the happiest people in Europe. The Cambridge study concludes that “[o]ne of the most consistent trends is that those with the highest levels of happiness also reported the highest levels of trust in their governments, the police and the justice system, as well as those around them. Happier people also tended to have plenty of friends and acquaintances, as well as at least one very close friend, or a partner.”

A final study was conducted in 2009 by the OECD (Organization of Economic Co-Operation and Development) and once again Denmark was named the happiest country. This study was based on “subjective well-being, defined as life satisfaction”, and asked the question, “D[o] people feel like their lives [a]re dominated by positive experiences and feelings, or negative ones?”

How Can We Increase Our Happiness as a Nation?

I can say with certainty that happiness is not based on Gross Domestic Product (GDP) or the amount of our tax burden alone. Most of us have limited resources and know that the lack of money can make us pretty miserable around bill-paying time. The same is true if we owe the IRS a lot of money and April comes around. However, gobs of money and low tax burdens do not have a strong correlation to true happiness. As listed above, some of the studies showed that trust in government, health, wealth (enough to be comfortable), and education are all good indicators of happiness, and are all prevalent in Denmark. This begs the question as to why Americans are not higher up on the ‘happy chain’? If we take the same indicators used in the studies above, we can start to see why we may be lacking in happiness. Overall, there is a growing distrust of government in the United States. Nearly 1/3 of Americans are obese, diabetes and heart disease are also wearing on our overall health. There is also a prevailing cultural obsession with those who are wealthier than us (keeping up with our neighbors and idolizing celebrities), and with consumerism, both of which can lead to discontent and to a lot of debt. We’ll need to start tackling these issues before we can beat Denmark at the happiness game.

Gobs of money and low tax burdens do not have a strong correlation to true happiness. Click To Tweet

What do you think are indicators of happiness? How do you think Americans can improve their happiness as a nation?

48 replies
  1. Sustainable PF
    Sustainable PF says:

    We ranked 10th here in Canada. Not bad! Although quite unpopular in the US I think the social programs (read: universal health care) and knowing we can all be cared for when we are ill is really important. Other strong social programs help too – as a Nation we’ve agreed to support each other regardless of societal status.

    Reply
    • Gary B
      Gary B says:

      Interesting… I have worked in Canada on 3 long term contracts, and have been told on many occasion by Canadians that they hate socialized medicine and most (who had the means) come to the US for most major issues…

      … Also told, God forbid, if you need a surgery that is not seen as absolutely necessary, you will wait for ever (also why Canadians come to the US for treatment)…

      Reply
  2. optionsdude
    optionsdude says:

    I think trusting the government to do the right thing is a big key. Unfortunately, there is a big debate as to what that might be. I am sure that overall health plays a role in happiness.

    Plus, Denmark has the lowest Gini index (measure of income equality) from the period 1992-2007 meaning that the gap between rich and poor is less than any other country. It makes sense with the highest tax rate. So the jealousy that might leave some feeling slighted in a societal system is minimized.

    Reply
  3. Forest
    Forest says:

    Easy access to heath care and health education as well as real world education make the Danish a pretty well educated and rounded, healthy bunch….. Which leads to happiness and the ability to be able to achieve in life. That’s what I think si I guess I agree with you :).

    Reply
  4. Travis@TradeTechSports
    [email protected] says:

    I wonder how the social classes in Denmark look? Meaning here in the US it seems we keep growing the classes further apart. I wonder if Denmark’s happiness as a country is related to the social classes.

    Reply
  5. Maggie@SquarePennies
    [email protected] says:

    I wonder if the Danes work less hours per week than we do? There is huge pressure put on US workers to work more and more hours with no increase in pay. And do they get more vacation days on average? A person’s happiness often comes from relationships and time with friends and family. In the US we have less and less leisure time, so why wouldn’t we be less happy?

    Also in the US we worry about affording college for our kids and our own retirement. In many countries and probably Denmark, they don’t have to worry about that with their social programs. Somehow they can afford that.

    Reply
    • FruGal
      FruGal says:

      I think those are all great things to bring up. I know that in many European countries there is more vacation time, and in some the workweek is 35 hours or less. Thanks for your thoughts!

      Reply
      • Maggie@SquarePennies
        [email protected] says:

        FruGal, we used to have neighbors from Europe and they were amazed at how much we worried about affording college and retirement. Even though the man had a US working schedule here they made time for having friends over every weekend. It seemed to be a lifestyle they had in Europe.

        Reply
      • Diana
        Diana says:

        what is the number of people working?Do they own 3-4 trucks?or a boat? Or many material things as 4 thousand sq foot homes?
        How many live in your country?

        Reply
  6. Daniel Olsen
    Daniel Olsen says:

    I stumbled upon this website all of a sudden when searching for a different issue on the web, nevertheless here is my oppinion partially.

    The danes are a well educated people, all education is free including universities. That means our democracy is based upon substance and not catchy phrases and slogans. We trust our politicians to do the right thing and might even appear arrogant towards other nations, because we feel that many democracies arent really democratic at all.

    My neighbours child will be treated by some of the worlds best healthcare system if something happens, regardless of blame. He will get a decent education and contribute to society on equal foot with everyone else.

    I dont bow to anyone, nor would I ever dream of calling anyone “mister”, if a person cant look me in the eyes and talk to me as an equal, they dont deserve my attention and are usually frowned upon.

    We have a very free sexual society, the danes like to party, socialise and restrict themselves to their 37 hours of weekly labour, anything more is throwing your life away. We work to live … not the other way round. My friends are far more important than my job.

    Life as a whole is beautifull, I couldnt imagine living in another country now … and yes, I have tried … 🙂

    Anyway, everything is subjective. But this was just a small portion of attitude. Stay safe and remember to hug life.

    Reply
  7. Kathryn
    Kathryn says:

    Sounds like socialism to me. No the education and healthcare and everything else is NOT free, your taxes are paying for it even if you don’t want or use it.

    Reply
    • Albatros
      Albatros says:

      YEAH We are paying for it in Europe but arent you Americans paying taxes too? I am a single guy and I LIVED IN NYC ND MY TAXES I WAS PAYING USED TO BE MORE THEN 35% of my paycheck, What did i get in return absolutely nothing, so you pay taxes and you dont have anything for free because your taxes go to the military that makes wars to enrich the rich and to get you even poorer, Corporates do not pay nothing but get tax breaks, Rich and very wealthy people do not pay nothing, Bankers get bail out and free money with your tax dollars, your retirement and social security funds are dried, you live to work, to pay taxes and you do not have no social system, your brain is washed with chemicals on the water and the food, your environment is filthy and nasty, your cities are dirty filled with ghettos and filth, you dont have nothing to offer just the American nightmare, we may pay a little more taxes then you but is way worth it because OUR SALARY IS A LOT HIGHER THE USA AND BECAUSE WE HAVE ALL THE NEEDED SERVICES FOR FREE, but i guess you deserve that shitty lifestyle so go a head and live it

      Reply
      • Maureen
        Maureen says:

        I hate to burst your bubble but the reason why Americans pay for their own healthcare and higher education is because we have the resourcefulness and intelligence to do so. Denmark has the luxury to do what it does because it is an insignificant country. Not to you of course but on the world stage it is a nobody country that very few people in the world could find on a map when asked. Tell me with all that free stuff why is it that Denmark does not lead the way in technology, agriculture, exports, medicine and science? Oh right because The US does and we don’t have the government paying for our higher education! Go figure? When there is a tragedy who does the world turn to? You? That would be the US again and although we have a pretty robust welfare system we can still assist other countries as well. When was the last time Denmark went to the moon, sent a technologically advanced satellite into space or…wait has Denmark even left planet Earth? Is the US perfect? God no! You pointed out some valid flaws and not so valid ones but the fact is that although we may not be tip toeing through the tulips of happiness like you are we are the world super power for a reason. Ingenuity, intelligence, resourcefulness, HARD WORK and just plain guts. All of which are lacking in Denmark’s happy land.

        Reply
        • Jill
          Jill says:

          Very well said! God bless the USA! I love this land & its people. We can all find negatives regarding other countries, but the positives that the US has contributed to the world outweigh them all. I thank God everyday for letting me live here. I wish non-citizens would realize how blessed mankind is because of America! It’s true.

          Reply
        • Sarah
          Sarah says:

          Arrogance is not an reply and that’s what I’m hearing. Arrogance is synonymous with ignorance. You should get out in the world and meet more people especially from other countries.

          Reply
      • TheGhostofBelleStarr
        TheGhostofBelleStarr says:

        gee Albatros…I guess you’d be happy paying 80% taxes…or maybe hey give all your paycheck to the government and let them provide you housing, food, medical and someone to wipe your azz kinda like in Communist Stalin’s setup….you get the least and the elites in the government who tell you what to do and think get the best…

        Reply
      • dave
        dave says:

        @Albatros , sounds to me that you were fooled by “The grass is greener on the other side” Expression. Danes pay thru the nose for such services and are kept at bay by the Danish government ! How does it feel to be told how much money you will be capped at and to have your dreams dictated by the government of Denmark?!

        Reply
      • john phillips
        john phillips says:

        50% of Americans pay zero taxes and they are usually the ones living among the rich in places like NYC, throwing their garbage about the place. Different cities and states have far different tax codes. NYC has a 35% tax rate because the federal, state and city collect taxes to pay for all the deadbeats that live there. In Florida, the tax rate is about 10%. There are thousands of beautiful, clean and functioning little towns across the USA, you idiot. As for our military and your lack of, that enables pissy little countries like yours to exist, otherwise, you would be getting cornholed by a few Germans right now, or Russians. You are a free nation because us big boys stopped bad people from wiping you off the map. Your stupidity knows no bounds when you say corporations and the rich pay no taxes. Exxon pays 32 billion a year in taxes. The top 20 companies in the US combine to pay more taxes than the whole of Denmark. The US has the highest corporate tax rate in the world, but morons like you would never know that because you are too busy begging for free things, you have no time to research. Do you even realize that free things come from taxes, so they are not free, just paid for by hard workers and corporations?

        Reply
      • Diana
        Diana says:

        You sound like a Bernie fan! We all pay more why?SOCIAL PROGRAMS, YOU are paying for those who don’t do anything!

        Reply
  8. Brian
    Brian says:

    Very good article. I also like many of the comments. I, too, would be happy with my tax contributions if I saw some real and personal benefit from those yearly taxes. As it is, though, U.S. tax revenue does not benefit the majority, but rather very well defined subgroups of citizens. More to the point, I would guess that a higher percentage of individuals pay taxes in Denmark than here in the U.S., making it possible for the majority to benefit from those taxes.

    Again, great article.

    Reply
    • FruGal
      FruGal says:

      Thank you Brian!

      Also, thank you for sharing your thoughts. It is amazing to find out that 49% of Americans do not pay federal income tax, though I know many of those are retired/unemployed/etc.

      Reply
    • Diana
      Diana says:

      It is a liberal university I am sure I wonder how many live there or just write what they write?we have in USA TOO MANY OUT of work, who pays the rich just move!You think Hollywood stars wanna pay % 90 percent!!!LMAO
      Will smith fell OFF his chair when in France they asked would you pay more in taxes
      Oh yeah then when they said 75 percent he said WHAT!

      Reply
  9. Christian Nybo Holmberg
    Christian Nybo Holmberg says:

    I am a Dane, and I love my country! Yes, we do have to pay a lot of taxes, but it all pay off in the end! I couldn’t imagine living in another country without all those benefits that we get from the government. Right now I’m living in the Unites States as an exchange student, and many tell me that they are jealous of the way my country works, and I agree. But I also think that the free education sometimes can be a problem. Since the kids don’t pay for their education, they don’t take school as serious as the kids over here.

    Christian 🙂

    Reply
    • Amanda L Grossman
      Amanda L Grossman says:

      It’s great to hear from a Dane on the matter:).

      Interesting thoughts on the education and kids taking it for granted when it is free. I wonder if that happens sometimes here when college is paid for completely by the parents?

      Reply
      • C Hudson
        C Hudson says:

        As a university professor here in the U.S., sometimes I can actually pick out the students that are obtaining a ‘free’ education (parents/grants/etc.) compared to those that pay to attend the university. From my 10+ years of experience, there is a definitive difference in behavior and attitude when a student is paying for their own education.

        Reply
  10. Concerned Citizen
    Concerned Citizen says:

    If they are the happiest people, why do they have one of the highest suicide rates in the developed world?

    Reply
      • Abbey
        Abbey says:

        Wikipedia should not be a site on which you rely. They are suspect at best.
        Many US citizens do not pay federal tax because of the earned income tax credit or they do no work and rely on the government to support them.
        We do have challenges with healthcare, but things are worse as a result of the AHCA (Obamacare). Rates, deductibles, co-pays are much higher and quality is down. You cannot choose your doctor and they do not have the time to spend with you. You are a number and a mass of paperwork, no more or less.
        Pharmaceutical companies should be reined in as should our focus on treatment rather than prevention. Also if interstate commerce were allowed so that healthcare providers could compete, then costs would go down. Think basic economics.
        In Denmark, their rate of obesity is about 9% and in the US we are at about 36%. The health issues related to this are numerous. Again, supply and demand.

        Danes ride their bikes everywhere and live in modest homes. Yes, they work fewer hours, but they are not an economic powerhouse (do you love you I-Phone) that supports freedom in the world and helps everyone in times of crisis. These are just a few of the differences.
        This article explains that things are not so rosy in the welfare state.
        http://www.nytimes.com/2013/04/21/world/europe/danes-rethink-a-welfare-state-ample-to-a-fault.html?_r=0

        Reply
  11. Luann
    Luann says:

    Have you ever thought about writing an ebook or guest
    authoring on other websites? I have a blog based upon on the same information you
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    Reply
  12. Heidi
    Heidi says:

    Hi, I was wondering if Denmark is one of the countries to ban Monsanto and GMOs. Here in the US, people would have a hard time paying for things like organic food and holistic family Dr’s and dentists if we got taxed that much. It seems like there would be less of a sick-care burden on their society if consuming higher quality nutrition was more of the norm there, than it is here in the US. Also I’m wondering if they have access to holistic and naturopathic medical providers or if they only have access to mainstream ones. It also seems like there would be less of a burden on the health system if the healthcare they used focused more on healing people than on pharmaceutical drug sales. This would be a very important issue for our family.

    Reply
  13. David sandwell
    David sandwell says:

    Try measuring a country’s worth by just how many people want to get it or leave it! Does Denmark have problems with tons of folks trying to get in? US does, gee I wonder why????

    Reply
    • Joel Hackbart
      Joel Hackbart says:

      There will, in any society, be a subset of unhappy people. Ironically, these people, while in a minority, have much greater envy issues when they see so many others happy, which in turn only compounds their depression.

      Reply
  14. JIM F BOHRER
    JIM F BOHRER says:

    It’s easy to throw out a happiness ranking without really finding out if people ARE in fact feeling happy. The study defines “happiness” as three “quantifiable” elements. In that case, sheep, turkeys, and cows could easily be defined as “happy” when on a farm receiving regular medical treatment, good food etc… Before they become food for us. Our founding document which I believe is the Declaration of Independence defines happiness as something we have to pursue. It is not something given or granted to a person. The point about drug use to overcome depression also should be a factor in examining if people are intrinsically happy or just “defined” as happy by extrinsic partisan studies.

    Reply

Trackbacks & Pingbacks

  1. Denmark High Taxes Happiness | Make Money Online says:

    […] Denmark: Highest Tax Rate and Happiest People – Frugal … – It turns out that Denmark has the highest tax rate in the world … (unless it increases the Danish people’s happiness to pay taxes). Happiness also is not … […]

  2. […] …some of the studies showed that trust in government, health, wealth (enough to be comfortable), and education are all good indicators of happiness, and are all prevalent in Denmark. This begs the question as to why Americans are not higher up on the ‘happy chain’? If we take the same indicators used in the studies above, we can start to see why we may be lacking in happiness. Overall, there is a growing distrust of government in the United States. Nearly 1/3 of Americans are obese, diabetes and heart disease are also wearing on our overall health. There is also a prevailing cultural obsession with those who are wealthier than us (keeping up with our neighbors and idolizing celebrities), and with consumerism, both of which can lead to discontent and to a lot of debt.” (Denmark: Highest Tax Rate, Happiest People) […]

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