Exploring the nexus between national innovation performance and happiness

Abstract The study of happiness in economics has started to gain considerable momentum. Social policy factors are currently being recognized as determinants of national competitiveness, while innovation is an important factor to ensure economic growth and societal well-being. In order to shed light on the complex relationship between innovation performance and societal happiness, an examination was conducted in 130 countries that covered observations from 2011 to 2022. The analysis aims to uncover the degree to which these two dimensions are interconnected and to discern whether one may be identified as the causal factor of the other. The results derived from the SGMM regressions reveal that spaces characterized by elevated levels of innovation also tend to exhibit correspondingly higher indicators of resident happiness. Notably, this relationship is particularly pronounced in countries with observed real income per capita. Consequently, this study supports the hypothesis that innovation fosters improvements in resident well-being, despite ongoing debates. In light of these results, understanding the positive association between innovation and happiness has significant policy implications for fostering economic growth and enhancing quality of life on a national scale.