Countries with more economic freedom have happier people, according to a study published Tuesday by the Fraser Institute.
Economic freedom determines how much control someone feels they have over their life, which can affect happiness levels.
The happiness benefit is seen even when other factors that might increase happiness and also are prevalent in economically-free countries are held equal. These include higher levels of health, income, trust and employment. Economic freedom actually makes people happier than their income, age, political system or job status, the study says.
"Clearly, living in an economically free society has an important impact on the average citizen," said Fred McMahon, the Fraser Institute's Research Chair in Economic Freedom. "Past research concluded that economic freedom spurs prosperity, income, employment and better public institutions."
The Fraser Institute annually publishes a ranking of economic freedom in every country. The United States is ranked 12th in the world, behind countries such as New Zealand, Canada and Jordan. The U.S. is tied with the United Kingdom, with a score of 7.81 out of a possible 10. Hong Kong is the most free country in the world, scoring 8.98, while Venezuela is the least free, scoring 3.89.
The happiness study measures how satisfied people are with their lives and how much control they feel they have over their lives. People in four other countries feel they have more control over their lives than people in the United States.
"If you live in a country where you can freely trade with others, choose your occupation, enter freely into business and keep more of what you earn, then you're going to feel like you have control of your future which in turn is going to make you happier," said Martin Rode, who co-authored the study and is a professor of economics at Universidad de Navarra in Spain.
Economic freedom is measured using several factors, including the size of government, property rights, monetary system, free trade, and regulation.
The Fraser Institute is a Canadian think tank that does not accept government grants or contracts for research.