What is the key to happiness?

Good mental health and relationships are a stronger determining factor of happiness than financial status, according to a new study by the London School of Economics (LSE).

Researchers found that widespread elimination of depression and other mental illnesses reduced unhappiness by 20 per cent, while an increase in financial wealth only had a five per cent impact.

Economist Lord Richard Layard, who led the study, said the report aimed to "revolutionise how we think about human priorities" and promote the "burgeoning new science of 'subjective wellbeing'", rather than relying on the common belief that happiness is linked to finances.

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"The evidence shows that the things that matter most for our happiness and for our misery are our social relationships and our mental and physical health," he said. "This demands a new role for the state – not 'wealth creation' but 'wellbeing creation'."

Layard also commented on the role of the state in the wellbeing of its citizens, indicating there has been a shift in priorities in recent decades.

"In the past, the state has successively taken on poverty, unemployment, education and physical health. But equally important now are domestic violence, alcoholism, depression and anxiety conditions, alienated youth, exam-mania and much else. These should become centre stage," he said.

The report also argued that treating mental illness at a societal level would not cost the country money, due to the financial benefits that would be felt should anxiety and depression be reduced among the population.

"Although living standards have vastly improved in the last forty years, levels of enjoyment from life have stayed static for people in Australia, Germany, the US, and the UK," says The Independent.