For centuries, visitors to the United States have been struck by the boundless optimism of its people. Recent research bears out the stereotype, confirming that Americans really are more hopeful about the future than their peers in other wealthy nations. But it also suggests that American optimism may now be waning in the face of contemporary political and economic challenges.

Alexis de Tocqueville, a French observer of American life at the beginning of the 19th century, observed that the Americans of his day “have all a lively faith in the perfectibility of man ... They all consider society as a body in a state of improvement.” Political and social observers have echoed this sentiment for centuries, enshrining optimism as an essential feature of not just the abstract ‘American Dream,’ but also of the social and economic institutions of American civil society.

“Anyone visiting America from Europe cannot fail to be struck by the energy, enthusiasm, and confidence in their country’s future that he or she will meet among ordinary Americans—a pleasing contrast to the world-weary cynicism of much of Europe,” observed Irish philosopher Charles Handy, who retraced de Tocqueville's trek across the country in 2001. “Most Americans seem to believe that the future can be better and that they are responsible for doing their best to make it that way.”

That Tocquevillian optimism has certainly dimmed with the Great Recession: People in advanced nations including the U.S. are far less optimistic than those in poorer ones about the financial future of the next generation of citizens, in part because emerging and developing nations weathered the global financial crisis better than anyone expected. But Americans continue to see life on the up and up despite the burdens of economic downturn, social and racial unrest and the specter of terrorism. On Wall Street, the Dow climbed to a record high in November amid optimism about economic growth. CEOs predicted a 2015 with better jobs and better pay, despite the country’s sluggish recovery from the Great Recession. On Main Street, the average American thinks the country will improve in 2015, despite years spent caught in a cycle of frustration about the political and economic state of the union.

“The challenges that this generation of Americans has faced, they're less dire than those that the Greatest Generation endured,” declared President Obama at the City Club of Cleveland on Wednesday. “But we've got the same will. We’ve got the same drive. We’ve got the same innate optimism required to shape another American Century.” But where does this sunny confidence spring from? What is it about their culture that makes Americans so psychologically predisposed to optimism?

It’s not just a stereotype. Recent data on national attitudes bears out the conventional views of American optimism. According to analysis by George Gao of the Pew Research Center, Americans are far more upbeat when asked if they’re having “a particularly good day” than their peers in other advanced nations like Germany, the UK, Spain, France, and Japan. Where Pew’s analysis shows a general inverse relationship between GDP per capita and daily optimism, the U.S. stands out as an obvious exception among advanced economies.

Outside of the U.S., Fewer People in Rich Countries Describe Their Day as a Good Day

Pew Research Center

This relative gap has held fast, despite the economic and political anxieties of the Great Recession and America’s campaigns against terrorism over the past decade. Data on “feelings of happiness” collected by the World Values Survey (WVS) between 2005 and 2014 reveal citizens in other advanced nations are less happy and optimistic than those in the United States. An average of 36 percent of Americans said they were “very happy” over the last ten years, beating out citizens in Japan, Chile, Poland and Germany.

Feelings of Happiness in Advanced Countries, 2005-2014

World Values Survey

So why are Americans so optimistic? A growing number of psychologists and sociologists believe it’s the Western world’s distinct tradition of individualism—and Americans’ fervent embrace of it—that helps the U.S. respond to uncertainty and turmoil with an eye towards a brighter future.

“It’s actually not that people are inherently optimistic or pessimistic; we’re wired for both,” says Dr. Edward C. Chang, a clinical psychologist who runs the Perfectionism and Optimism-Pessimism Lab at the University of Michigan. “It’s a dual process mechanism, the sort of daily meditation that helps people regulate their expectations. It’s this psychological process that keeps people from becoming so optimistic they’re like Mr. Magoo, or so pessimistic they fall into a pit of despair. The two compliment each other; whether you’re more or less optimistic or pessimistic is heavily dependent on the culture you live in, the culture that shapes your values.”

Studies suggest broad cross-cultural differences with respect to optimism. Some researchers, including Chang, have suggested that Western cultures may promote independent notions of the self more than Eastern cultures that stress interdependence. Even if that is accurate, though, it would not explain what distinguishes the U.S. in particular from other Western nations. If individualism is all it takes to make an optimistic culture, why aren’t the Germans and French as exuberant as Americans? It may be that Americans take Western individualism to a different level than their European counterparts. While individualism runs deep in European civil society, it’s a patriotic norm in the United States, a matter of national identity and an sacrosanct mantra of living as a red-blooded American: work hard, play fair, and look on the bright side.

“When you think about American culture broadly, it centers entirely on the independent self and the happiness of the self, and not just in a general way,” Chang explains. “It’s ingrained in the culture as an explicit, essential value — we’re hit over the head with American freedom and liberty and rugged individualism so much so that explicit pessimism isn’t actually tolerated that much in our society. It’s treated as a mental illness, a sign of depression.”

Data from both Pew and the World Values Survey suggest that the centrality of  “life, liberty and the pursuit of happiness” in American life actually does translate into positive views of self and perceptions of personal control that are correlates of psychological optimism. When asked if “success in life is pretty much determined by forces outside our control,” Americans disagreed far more than citizens in other advanced economies surveyed.

As Harvard researcher Adam Okulicz-Kozaryn argues in the Journal of Happiness, Americans maximize their happiness by working and Europeans do so through leisure. "Americans may work more because they believe more than Europeans do that hard work brings success,” writes Okulics-Kozaryn.

And consider “positive views of self.” According to Pew, more Americans agree that “our people are not perfect, but our culture is superior to other” than do citizens of other Western countries, including Spain, Germany and the UK:

Religion may also play an important role. After all, Pew data shows that Americans aren’t just happier than those in other advanced nations, but more religious as well. More than half of Americans surveyed said religion was “very important” in their daily lives lives, once again beating out the likes of Germany, Canada, Australia and the UK.

Wealthier Nations Tend to be Less Religious, but the U.S. is a Prominent Exception

Pew Research Center

Data from the WVS reinforces Pew’s findings. Fully 40 percent of Americans say religion is “very important” in their daily lives, beating out every nation but Poland. “In general, people in richer nations are less likely than those in poorer nations to say religion plays a very important role in their lives,” observes Pew’s George Gao. “But Americans are more likely than their counterparts in economically advanced nations to deem religion very important.”

Religious values are deeply embedded in every aspect of American life, including the cultural emphasis on hard work as a metric of self-improvement. Puritan values—salvation through hard work, frugality, and economic discipline among them—“infect the great bulk of Americans to this day,” explains Handy. “They implanted the American work ethic, as well as the tenacious primacy of religion in American life, equaled only by the Muslim world.” As de Tocqueville once observed: “The Americans combine the notions of religion and liberty so intimately in their minds, that it is impossible to make them conceive of one without the other.”

Scholars have found connections between a person’s religiosity and their psychological predisposition towards optimism. Psychologist Martin Seligman found that individuals who participate in more “fundamentalist” religious activities—prayer, sermons, liturgy—were more optimistic than their moderately religious and agnostic peers. Similar research by a team of psychologists at the University of Kentucky also shows that “intrinsic religiousness and prayer fulfillment were associated with greater life satisfaction.”

So is this a good thing or not? Champions of American individuality and optimism assert that these qualities made the U.S. respected for its scientific and technological innovations, strong geopolitical leadership, and legendary industriousness. To them, the American Dream is the dogma that distinguishes the American promise of freedom from other liberal democracies, as permanent a feature of Americana as apple pie and baseball.

But optimism, as Chang and other cultural psychologists note, is a state of mind, a reaction to the social stimuli of the world—and recent polls suggest that Americans’ optimism is fading. When asked in a WSJ/NBC poll if “life for our children’s generation will be better than it has been for us,” 76 percent said they do not have such confidence, while only 21 percent did—the worst response ever recorded by the poll. It’s no wonder: The average American faces flattening wages and staggering wealth inequality while economic elites see soaring gains, a government wracked by partisan gridlock and awash in millions in political “dark money,” frustration over racism and race relations, and perpetual anxiety over the specter of terrorism.

Optimism and pessimism are certainly shaped by culture, but they’re tools for managing our expectations when faced by uncertainty. With America’s social, political, and economic institutions in turmoil, cynicism and skepticism may serve the American public well. Few will want to declare the idea of the American Dream dead, nor should they: Skepticism towards dysfunctional institutions is not mutually exclusive with a positive view of the future, as data about Millennials shows. But a sliver of doubt to temper American’s cultural optimism might help bring the American Dream closer to reality.