The World's Happiest Countries, taken from the Forbes article here.
In Nepal, for example, inflation is 11%, unemployment 46%. Yet a surprisingly high 50% of the people say they are satisfied with their standard of living and 81% have confidence in their banks. Could be they're scared of voicing their true opinion in a shaky democracy, or maybe the Nepalese are just endemically happier people. Legatum adjusts for this, adding a variable called "ability to express political opinion without fear."
According to the article, many small, sparsly populated countries make the top 10. So PEOPLE make one less happy? I may be reading too much into that.... The USA dosn't make the top 10--we're #14. Well, no we kind of do: in populations over 150 million, the USA is #10
Which begs the question, what does happiness mean to you?