The following is a summary of a class discussion.
In 2013 The Economist, a British magazine,
reported on an Organization of Economic Cooperation and Development (OECD)
study of how measures of GDP per capita or wealth per person by country compare
to measures of the welfare of each country’s bottom ten percent. The study
found that there is a close correlation between GDP per capita and how well-off
the bottom ten percent is. See http://www.economist.com/blogs/graphicdetail/2013/05/daily-chart-17?Fsrc=scn%2Fgp%2Fwl%2Fdc%2Fbetterlifeindex
.
Among the
countries studied, the US performed fourth best, after Canada, Sweden, and
Australia. According to the Heritage
Foundation’s ranking of economic freedom--or absence of socialism and
regulation--Canada ranks six, Sweden ranks 26, and Australia ranks five in
terms of economic freedom. In contrast,
the US ranks 11 in terms of economic freedom.
In other words, two of the three
countries studied in which the bottom ten percent are best off have LESS
SOCIALISM and regulation than the United States does.
At the
bottom of this email, I list the 25 most-free countries and their wealth ranks
(average wealth rank= 38) and of the 25 most-socialist countries and their
wealth ranks (average wealth rank=154).
After that I list the 13 countries with populations of 100 million or more. The wealthiest of the countries with 100 million or more population is the US, with an economic freedom ranking of 11 and a wealth rank of 19, and Japan, with an economic freedom ranking of 22 and a wealth rank of 43. The other 11 countries with over 100 million population have a mean economic freedom ranking of 109 and a mean wealth ranking of 129. Large countries tend to adopt socialism, and as a result they tend to be poor.
The Scandinavian
countries are in flux, and have a split personality. Student K-S is right that Denmark, Sweden,
Norway, and the other Scandinavian countries still have high welfare
benefits. However, in many ways they
have become or are becoming less regulated than the US, which has caused sharp
increases in their wealth or GDP per capita. This article by the Foundation for
Economic Education gives an overview:
The author writes:
Scandinavia is in the midst of an economic transformation. Thanks to tax reform, openness to investment/trade, sound property rights, little corruption, and continuing efforts to privatize, economies there have made great strides toward liberalization. Denmark, Finland, Iceland, and Sweden have been rated “free” economies by the Heritage Foundation’s 2006 Index of Economic Freedom (online at www.heritage.org/research/features/index/countries.cfm). Norway lags behind with a “mostly free” rating. Norway has had fewer incentives to liberalize because of its large oil endowment.
I looked up the current rankings of GDP per
capita by the CIA, which is available at
As well,
I looked up the economic freedom (lack of socialism and lack of regulation)
rankings by the Heritage Foundation for the 25-freest countries and the 25
least-free countries.
The five economically
freest, least socialist countries--Hong Kong, Singapore, New Zealand,
Switzerland, and Australia--have an average wealth ranking of 23.4, which puts
them in the top 10% in terms of wealth.
The five most socialist or least economically free countries—Turkmenistan, Zimbabwe, Venezuela, Cuba, and
North Korea---have an average wealth ranking of 149.2, which puts them in the
bottom 20% in terms of wealth. Socialism
causes suffering of the poorest people in those countries.
I have tabulated the list of the 25 -freest (least socialist) countries and the 25 least-free countries as compiled
by the Heritage Foundation (see http://www.heritage.org/index/ranking
) along with GDP per capita as compiled by the CIA. The list is. The mean wealth rank for the 25-freest countries is 38. The mean wealth
rank for the 25 least-free countries, the most socialist, is 154.
If one looks at the CIA rankings of
the richest countries, one sees that special considerations characterize most
of the 20 richest. These include oil
exporters--Qatar, Kuwait, Norway, Brunei, and UAE; small countries with wealthy
part-time residents, banking, or gambling—Macau, Luxembourg, Lichtenstein, Monaco,
Bermuda, and Sint Maarten; and small countries that are dependent on larger
ones—Isle of Man, San Marino, Jersey, and the Falkland Islands. If one removes those, the remaining top-20
wealthiest countries are Singapore, Ireland, Switzerland, Hong Kong, and the
United States. These are among the
freest countries, with a mean freedom rank of 5.2. The mean for the five is raised somewhat by
the US, which had the freest economy until the 1960s or so, and has been in
decline since it increased the degree of socialism under Lyndon Johnson and
Richard Nixon; more recently, George W. Bush and Barack H. Obama have also
increased the degree of socialism, so one can expect further decline in the US.
Here are
lists of the 25 most-free countries and their wealth ranks (average wealth rank=
38) and of the 25 most-socialist countries and their wealth ranks (average
wealth rank=154).
After
that I list the 13 countries with populations of 100 million or more.
25 Most-free
countries: Mean wealth rank 38
1. Hong
Kong Wealth rank 18
2.
Singapore Wealth
rank 6
3. New
Zealand Wealth rank 51
4.
Switzerland Wealth rank 16
5.
Australia Wealth
rank 26
6. Canada Wealth
rank 31
7. Chile Wealth rank 80
8.
Ireland Wealth
rank 14
9.
Estonia
Wealth rank 64
10.
United Kingdom Wealth rank 40
11.
United States Wealth rank 19
12.
Denmark Wealth
rank 30
13.
Lithuania Wealth
rank 65
14.
Taiwan Wealth
rank 29
15.
Mauritius Wealth rank 87
16.
The Netherlands Wealth rank 23
17. Germany Wealth rank
28
18. Bahrain Wealth
rank 23
19. Luxembourg Wealth rank 3
20. Iceland Wealth
rank 32
21. Czech Republic Wealth rank 59
22. Japan Wealth rank 43
23. Georgia Wealth rank 139
24. Finland Wealth
rank 41
25.
United Arab Emirates Wealth rank 12
25 Least-free countries. Mean wealth rank 154
154 Algeria Wealth rank 112
155. Laos Wealth
rank 164
156. Angola Wealth rank
156
157. Belarus Wealth rank 94
158. Burma Wealth rank
163
159. Ecuador Wealth rank 128
160. Bolivia Wealth rank
154
161. Solomon Islands Wealth rank 204
162. Ukraine Wealth rank
148
163. Democratic Republic of Congo Wealth rank 226
164 Chad Wealth
rank 196
165 Kiribati Wealth rank 209
166 Uzbekistan Wealth rank 160
167. Timor-Leste Wealth rank 172
168. Central African Republic Wealth rank 228
169 Argentina Wealth rank 85
170 Equatorial Guinea Wealth rank 36
171 Iran Wealth rank 95
172 Republic of Congo Wealth rank 156
173. Eritrea Wealth rank
219
174. Turkmenistan Wealth rank 98
175. Zimbabwe Wealth rank 205
176. Venezuela Wealth rank 96
177. Cuba Wealth rank 137
178. North Korea Wealth rank 210
13 Countries with over 100 million Population
Mean freedom excluding US and
Japan: 109
Mean wealth rank excluding US and
Japan 129
US: freedom rank 11 and wealth rank of 19
Japan freedom rank of 22 and wealth rank
of 43
1. China Freedom ranking 144 wealth ranking 113
2. India Freedom ranking 123 wealth ranking 158
3. United states Freedom ranking 11 wealth ranking 19
4. Indonesia Freedom ranking 99 wealth ranking 131
5. Brazil Freedom ranking 122 wealth ranking 103
6. Pakistan Freedom ranking 126
wealth ranking 171
7. Nigeria Freedom ranking 116 wealth ranking 159
8. Bangladesh Freedom ranking 137 wealth ranking 179
9. Russia Freedom ranking 153 wealth ranking 73
10.
Mexico Freedom ranking 62 wealth ranking 91
11. Japan Freedom ranking 22 wealth
ranking 43
12. Philippines Freedom ranking 70 wealth ranking 153
13. Ethiopia Freedom ranking 148 wealth ranking 208
