The Gallup Well-Being Index has declared this tropical country the happiest on Earth. Not once, but twice upon a time. So as an international well-being researcher, I felt compelled to travel there and explore possible explanations for these statistics. Why are people in this small country so happy? What is it that makes its people flourish? What can we learn from them? Join us on our field research trip to… Panama.
Who says Panama, says canal. The Panama Canal is worth about one billion US$ each year. It is the largest contributor to the economy of this small central American country. So to what extent could this explain the happiness of its citizens? From country-level research, we know that inhabitants of exceptionally poor countries tend to be unhappy indeed. But once a certain income level is reached, extra money does not seem to make a country as a whole much happier any more. This phenomenon is known as the Easterlin Paradox (which I explain in this video). So the Panama Canal revenues may have increased well-being at first, but may not add too much of it any more.
Panama is a tropical country in every sense of the word. It is hot and humid. Yet generally speaking, weather and sunshine do not seem to correlate with country well-being. For some people, not enough light in winter may lead to a disorder called “depression with seasonal pattern”, so on an individual basis, weather can impact your well-being indeed. Yet on a country level, there hardly seems to be a correlation with well-being. Which is good for Panama, because it does have a rainy season (though still very hot).
The flora and fauna in Panama is extremely diverse. This is probably due to this narrow strip of land where all kinds of creatures from all over the continent converge. The same applies to the Panamanian population, which is equally diverse and colorful. Research indicates that diversity not always associates positively with well-being, but Panamanians seem to have found a way to live harmoniously together in an easy-going tolerant way of life.
People in Panama seem to have a high level of trust in their future and (to a somewhat lesser degree) in each other. From country-level research, we know that trust is strongly associated with well-being. Also the opposite is true: if you cannot trust your fellow countrymen (as when they seem corrupt), chances are your country suffers from low well-being indicators. My personal impression is that on average, Panamanians seem to care about each other. And as Prof. Chris Peterson summarized his decades of well-being research in three simple words: ‘Other people matter’.
So how did Panama become so happy? It is always difficult to pinpoint causal relationships, but it appears to me that it may at least be partly due to its culture that treasures diversity, tolerance, optimism, warmth and care for each other.