United States gross domestic product topped $18.5 trillion in 2016, about $7.4 trillion more than that of China, the world’s second largest economy. GDP does not provide a complete picture of a country’s economy, however, and while the U.S. may have the biggest economy, it does not have the most competitive one.
A country’s economic competitiveness is affected by a combination of factors that range from its regulatory environment to the health of its population. Competitive economies require reliable infrastructure, quality education systems, strong institutions that are free of corruption, stable banks, and the ability to adapt to changing market forces by adopting new technologies and fostering innovation.
Weighing over 100 such measures, the World Economic Forum ranked 137 countries in the 2017-2018 edition of its Global Competitiveness Report. 24/7 Wall St. reviewed the most and least competitive economies in the world according to the WEF.
This year, the United States passed Singapore to rank as the world’s second most competitive economy due in large part to its capacity for innovation and business sophistication. Meanwhile, China’s economy, the second largest in the world, ranks 27th — dragged down by a climbing deficit and declining infrastructure quality, while ranking favorably in technological readiness and attracting foreign direct investment.