One thing I’ve always been disappointed about when I look up how different countries are doing, economically, is they were always biased. Either they favored metrics that favored specific countries by some unrelated metric out of the gate (such as size, trade deals, currency exchange rate, how they did in the past instead of now, etc), or even worse, they left a good portion of the measurement up to individual non-numerical interpretation; ranked less like actual research and more like judges with placards judging a singing performance. Or even worse, don’t give how they come to their rankings at all, just hoping you’ll trust what could be randomly decided numbers or just listing the ones that are their personal favorites.
To that end, I built the equation to be simple and fair, by which to judge countries, and did so before I started applying it to countries, so all values given here are without bias and done completely fairly. At the end of this article, I will explain the equation.
For reference, the closer a score is to 100, the closest it is to being a fair and healthy economy. (I’ve highlighted some often-looked-up and countries to make it easier.)
Countries by economic health
First up, are Big top 3 countries with the healthiest economies:
Iceland || 82
Belgium || 70
Slovakia || 66
Following up, we’ve got our “At least we broke above 50” crowd.
Malta || 59
Slovenia || 56
East Timor || 55
Qatar || 54
Luxembourg || 53
Montenegro || 53
Belarus || 52
Greece || 50
Estonia || 50
After this, is pretty much the countries that are our hall of shame. And to the detriment of Civilization on Earth as a whole… they’re kind of the majority.
Australia || 49
Albania || 49
Moldova || 49
Bulgaria || 49
New Zealand || 48
Japan || 48
Croatia || 48
Italy || 48
Romania || 48
Bosnia and Herzegovina || 48
Afghanistan || 48
Latvia || 48
Myanmar || 47
Spain || 46
United Kingdom || 45
Serbia || 45
Mauritius || 45
Lithuania || 44
Turkmenistan || 44
Burundi || 44
Sierra Leone || 44
Hungary || 44
Iraq || 43
Ethiopia || 43
France || 43
São Tomé and Príncipe || 43
Kazakhstan || 43
Finland || 43
Portugal || 42
Trinidad and Tobago || 42
Azerbaijan || 42
Tajikistan || 42
Mozambique || 41
Armenia || 40
Pakistan || 40
Seychelles || 40
Denmark || 40
Niger || 39
Mongolia || 39
Norway || 39
Libya || 39
Tanzania || 39Bahamas
South Korea || 39
Kyrgyzstan || 39
Uruguay || 39
Ghana || 38
Bangladesh || 38
Venezuela || 38
Eritrea || 38
Mauritania || 38
Taiwan || 38
Canada || 36
China || 36
Chad || 36
Jordan || 36
Hong Kong || 36
Guinea-Bissau || 36
Ireland || 36
Sri Lanka || 36
Netherlands || 35
Syria || 35
Haiti || 35
Tunisia || 35
Thailand || 35
Cambodia || 35
Tonga || 35
Samoa || 35
Vietnam || 35
Costa Rica || 34
Barbados || 34
Nepal || 34
Chile || 34
Gabon || 34
Israel || 33
Guyana || 33
Senegal || 33
Iran || 33
Liberia || 33
Poland || 32
Mali || 32
Lebanon || 32
Paraguay || 32
Mexico || 32
Zimbabwe || 32
Fiji || 32
Burkina Faso || 32
Togo || 32
Egypt || 32
Maldives || 31
Angola || 31
Argentina || 31
Djibouti || 31
Benin || 31
Guinea || 31
Jamaica || 30
Saint Lucia || 30
Saint Vincent and the Grenadines || 30
Aruba || 30
Antigua and Barbuda || 30
Grenada || 30
Dominica || 30
Turkey || 30
Georgia || 30
Solomon Islands || 30
Vanuatu || 30
Austria || 30
Kenya || 29
Malaysia || 29
Rwanda || 29
Peru || 29
Madagascar || 29
Ecuador || 29
Colombia || 28
Cameroon || 28
DR Congo || 28
Central African Republic || 28
Czech Republic || 27
Morocco || 27
Bolivia || 27
Uganda || 27
Panama || 27
Indonesia || 27
Papua New Guinea || 27
Belize || 26
Nicaragua || 26
El Salvador || 26
Singapore || 25
Equatorial Guinea || 25
Malawi || 25
Ukraine || 25
Algeria || 25
Cyprus || 24
Sweden || 24
Gambia || 24
Congo || 24
Switzerland || 24
Namibia || 23
Germany || 23
Comoros || 23
Kuwait || 22
Saudi Arabia || 22
Oman || 22
Nigeria || 22
Botswana || 22
India || 22
Yemen || 21
South Africa || 21
Zambia || 21
Laos || 21
Lesotho || 20
Russia || 20
Suriname || 19
Philippines || 19
United Arab Emirates || 18
Bahrain || 17
Brazil || 17
And finally… we have our worst 3 of all.
Brunei || 16
United States || 16
Bahamas || 12
About the equation used
Using a simple but novel algorithm, I have calculated the economic health of every nation.
When I say the economic health, I don’t mean it’s raw economic power. Much like a sick elephant will still be stronger than pretty much any world Olympic athlete at their peak.
So when I say economic health, I don’t mean who has the most money. I mean which one is most likely to reward you for the effort you put into it.
Afterall, just by value of being bigger, large countries are likely to have more straight up money.
Another might look at their ultra-wealthy, how many are there? But ultra-wealthy have a tendency to move to whatever country they can exploit and not pay taxes in. So this is actually a rather bad metric.
A follow up alternative might be ‘How much money do people have?” This would in turn unfairly favor countries with currencies that’s not worth much. Afterall. You could have 1 American Dollar, or you could have 360 Zimbabwe Dollars. They’re considered the same value. At which point, you might be tempted to just convert everything to the same currency… however, then you favor countries by exchange rate — it doesn’t judge their internal economic health, but again just strength of their currency on the world stage.
Due to trade discrepancies, using metrics of each country compared to another is likely to unfairly favor some countries over others, not due to the heath of their economies, but just pure economic size and political power.
Further, there was another bit that had to be dodged: Just because a country’s economically healthy now, doesn’t mean it always was; and the inverse is true. So a country that’s still economically developing, but on the upward rise, is very different than an old and crumbling economic empire.
The question of economic health is simply this: If you go there, how likely are you to financially succeed, as a member of the general populace, if you put in the time and effort to do so?
So, any algorithm to figure this out has multiple requirements:
- Only rely on internal data, instead of comparing to other countries.
- Must ignore or cancel out the numerical value of the money
- It must favor typical workers instead of the ultra-rich.
- It has to be calculable while ignoring factors that may give unfair advantages (like prices of specific staples or amounts of imports vs exports.)
- It has to demonstrate the economic mobility of the people in some way.
- Must ignore historical inertia — we’re only looking at the present.
I found an equation that did an amazing job of summing this all up. It largely resulted in the majority of work to calculate it already being done, just putting the numbers together. You see, in an economically fair society, you’d expect to see a pretty even stratification of wealth (regardless of how far or close the top and bottom rungs of society are). The most important becomes where the middle is versus where the middle should be.
Mathematically, there are two different middles to a range of values here. There’s the median, and the average.
Average is the everything added together, divided by the number of items.
The median is if you put all the values together on a line, which one would be in exactly the middle.
So, by comparing these two values, we can pinpoint how stable vs broken the economic ladder is in the country, giving a ratio between where the middle point on the ladder should be versus where it is. Are the ‘rungs’ of the economic ladder fairly evenly spaced, or are they wildly separated and unfair?
Further, median over average cancels out many, many variables we’re trying to avoid.
In short, it reveals how corrupt vs fair the economic system is independent of other metrics.
The equation is simply this:
Economic Health = (Median Income / Average Income) x 100
The multiplication value is simply to make the numbers easier to read, making it a score of 0–100 instead of generally complicated fractions.
To summarize what this means, I’ve made this illustration:
In an economic ladder, there should be a smooth progression. It means that all the stages of economic development are smooth and seamless. The larger the gaps in any part of the economic ladder, the more difficult it is for both individuals and businesses to grow, generally only a few already-established individuals when the gaps are very large.
The result of the number of the quation shows the difference between where that middle bar of the ladder is, versus where it should be.
A value of 100 means a perfect score.
A value of less than 100 means the middle rung is lower than where it should be (meaning the worst gaps in the economic ladder are above that), and a value greater than 100 means the middle rung is higher than where it should be (meaning the worst gaps in the economic ladder are above that. We can’t be sure if that’d be a good or bad thing, as no country has that scenario to look at).
Sources:
Data for Median Income & Average Income to calculate Economic health were taken from: https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult on June 19th, 2023 at 8:00 PM Mountain Time, USA
