The report is a cautionary tale for more money driven cultures like the United States. Economist Jeffrey Sachs points to Costa Rica as a shining example of a happy country despite its modest means.
Denmark is the world's happiest country, overtaking Switzerland, according to the fourth annual report on the subject.
Prepared by the Sustainable Development Solutions Network (SDSN) and the Earth Institute at Columbia University, the report ranked the US at 13, Germany at 16, the United Kingdom at 23, France at 32, and Italy at 50.
At the other end of the spectrum are Madagasgar, Tanzania and Liberia, with Afghanistan and Syria also in the bottom 10.
Columbia University economist Jeffrey Sachs, who also heads the SDSN and is a special adviser to UN Secretary General Ban Ki-moon, co-authored the report.
"Human well-being should be nurtured through a holistic approach that combines economic, social and environmental objectives," he said in a statement before the World Happiness Report 2016 was unveiled in Rome on Wednesday.
The report's metrics for measuring happiness across 157 nations include per capita GDP, social support and healthy life expectancy.
Since the first Happiness Report was issued in 2012, five countries - Bhutan, Ecuador, Scotland, United Arab Emirates and Venezuela - have appointed Ministers of Happiness. Their task is to promote happiness as a goal of public policy.
Little greed in Denmark
Kaare Christensen, a university professor in demography and epidemiology in Odense, the birthplace of fairy tale writer Hans Christian Andersen, says Danes aren't greedy.
"They are happy with what they get," she says. "Danes have no great expectations about what they do or what happens to them."
Sachs said the report was a warning to countries like the US, where money is more of a priority.
"For a society that just chases money, we are chasing the wrong things," Sachs said. “Our social fabric is deteriorating, social trust is deteriorating, faith in government is deteriorating."
He said nations err in viewing economic wealth as a panacea.
"Many countries in recent years have achieved economic growth at the cost of sharply rising inequality, entrenched social exclusion, and grave damage to the natural environment," Sachs said.
Danish social worker Knud Christensen says his compatriots feel secure in a country with few natural disasters and little corruption.
"We have no worries," Christensen said. "And if we do worry, it's about the weather. Will it rain today, or remain gray or will it be cold?"