Canadians are among the happiest people in the world, according to the first-ever United Nations World Happiness Report unveiled Monday.

Canada was ranked fifth in the world for happiness out of 150 countries.

Denmark, Finland, Norway and the Netherlands were ranked the highest, with an average score of 7.6 on a 10-point scale.

The study also suggested that the least-happy countries were underdeveloped nations like Togo, Burundi and Sierra Leone with an average score of 3.4.

The results were based on surveys from 1,000 residents in each country, taken every year for five years.

The report on global happiness was published by the Earth Institute of Canada and was released at a three-day UN conference on global happiness in the Kingdom of Bhutan.

"The (gross domestic product)-led development model that compels boundless growth on a planet with limited resources no longer makes economic sense. It is the cause of our irresponsible, immoral and self-destructive actions," Bhutan's Prime Minister Lyonchhen Jigmi Y. Thinley told the conference.

"The purpose of development must be to create enabling conditions through public policy for the pursuit of the ultimate goal of happiness by all citizens."

Report co-editor and University of British Columbia professor emeritus John Helliwell said there were five factors that reflect 90 per cent of the differences between countries:

  • family and friends
  • good health
  • material sufficiency (measured by income)
  • freedom

While income is important in both rich and poor countries, the report found factors like social trust, quality of work, freedom of choice and political participation have a more powerful effect on happiness.

The report said there are personal and external factors that influence levels of happiness, ranging from work and religion to community and governance and family experience.

In an interview with the UN, Bhutan Prime Minister Jigmi Y. Thinley said an economic system based on GDP should be replaced with one based on "gross national happiness," or GNH.

In the past, happiness has been measured through economic growth and material wealth for states, governments and individuals.

But the goal of the study was to urge governments to make happiness a priority while economics should be about making life better.

"The unfortunate outcome has been the belief that economic growth, material prosperity and the accumulation of wealth will lead to happiness," Thinley said in story published on the UN's website. "And the sad outcome has been the mistaking of the means for the end itself."