Assessing a country’s economic status can be a challenging task. While GDP and population size can provide some insight, they do not give a complete picture of a nation’s economic health. Income in dollars per person does not take into account differences in prices between countries, leading to discrepancies in living standards.
To get a more accurate understanding of a country’s economy, The Economist uses three measures: income per capita, income adjusted for local prices (PPP), and income per hour worked. By analyzing these three indicators, The Economist is able to provide a more comprehensive and nuanced assessment of each country’s economic situation.
The ranking system used by The Economist takes into account various factors such as per capita income, purchasing power parity and productivity levels. This allows for a more accurate assessment of each country’s economic status, providing a more insightful analysis of the various economic conditions around the world.