The Best and Worst Economies in the World

 The Most Competitive Economies

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10. Finland
> 2015 GDP: $229.7 billion
> Life expectancy: 81.1 years
> Gov’t debt as % of GDP: 62.4%
> Patent applications (per million residents): 291.2

Like many other countries in Europe, Finland’s economy was closely tied to that of the Soviet Union during the Cold War, and suffered after markets collapsed in the early 1990s. Now a European Union member state, Finland has one of the most competitive economies in the world.

Ranked slightly higher a year ago, the flagging global economy has undermined Finland’s competitiveness. Reduced demand from Russia, which is the third largest market for Finnish exports, is largely to blame for the country’s drop in ranking, according to the WEF. Still, Finland is an advanced innovation-driven economy, and is ranked as the best in the world for its legal institutions, and for health and primary education.

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9. Hong Kong SAR
> 2015 GDP: $309.9 billion
> Life expectancy: 84.0 years
> Gov’t debt as % of GDP: 0.1%
> Patent applications (per million residents): N/A

Though technically a part of China, Hong Kong governs its own economy. The differences between the two economies are considerable, as Hong Kong’s economy is among the most competitive in the world, while China’s trails more than two dozen other countries.

With exceptional transportation infrastructure and effective and efficient government institutions, Hong Kong has a solid economic foundation. It is also one of the most efficient economies for business in the world, second to none in the affordability and efficacy of financial services. Hong Kong is lagging slightly in innovative capacity. However, the city-state’s trade and investment policies are some of the most open in the world, which according to the WEF, will lead to increasing competition and ultimately innovation in coming years.

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8. Japan
> 2015 GDP: $4.1 trillion
> Life expectancy: 83.6 years
> Gov’t debt as % of GDP: 248.1%
> Patent applications (per million residents): 335.4

The modern Japanese economy took shape in the decades after World War II, when booming automobile and consumer electronics industries helped establish the country as a major economic power. Today, with a GDP of $4.12 trillion, Japan is the third largest economy in the world.

The largest drivers of economic competitiveness in the Japanese economy are its sophisticated businesses, large market, high quality infrastructure, and its health and primary education institutions. The life expectancy in Japan of 83.6 years is the second highest in the world, and all eligible residents are enrolled in primary school. In terms of infrastructure, Japan has some of the highest quality roads and railroads on the globe, as well as 3.71 billion airline seat miles available per week, the fourth highest airline passenger carrying capacity in the world. Japan is also a highly innovative nation with the most patent applications per capita of any country.

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7. United Kingdom
> 2015 GDP: $2.9 trillion
> Life expectancy: 81.1 years
> Gov’t debt as % of GDP: 89.3%
> Patent applications (per million residents): 94.5

The United Kingdom economy ranks high in labor market efficiency and technological readiness. More than 90% of UK citizens use the Internet, which is among the fastest Internet on the planet. The country also ranks highly for its capacity to both attract and retain talented workers, and for its flexible hiring and firing practices. With a GDP of $43,771 per capita, the UK is also one of the wealthiest countries worldwide.

The effects the recent Brexit vote will have on the seventh most competitive economy are still unknown. Some of the UK’s most salient competitive features — the prevalence of foreign ownership and ability to attract international students and workers — may be negatively impacted by the country’s exit from the European Union.

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6. Sweden
> 2015 GDP: $492.6 billion
> Life expectancy: 82.0 years
> Gov’t debt as % of GDP: 44.1%
> Patent applications (per million residents): 320.0

Sweden’s economy is the most competitive of all Nordic countries and the sixth most competitive in the world. While the country’s high tax rates are considered a major impediment to economic competitiveness, those tax dollars fund some of the world’s most effective and efficient government institutions. The country ranks among the top 10 globally in property rights, public trust in politicians, judicial independence, and government spending.

Sweden is especially notable for its innovative capacity. Swedish companies spend far more than is typical on research and development, and the country’s universities are often heavily involved in R&D projects. Likely due to this emphasis on innovation, 320 patent applications are filed in the country for every 1 million residents, the second most of any country reviewed.