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From Wikipedia, the free encyclopedia

The world economy or global economy is the economy of all humans of the world, referring to the global economic system that includes all economic activity within nations and between nations, including production, consumption, economic management, exchange of financial values and trade of goods and services.[1][2] In some contexts, the two terms are distinct "international" or "global economy" being measured separately and distinguished from national economies while the "world economy" is simply an aggregate of the separate countries' measurements. Beyond the minimum standard concerning value in production, use and exchange, the definitions, representations, models and valuations of the world economy vary widely. It is inseparable from the geography and ecology of planet Earth.

It is common to limit questions of the world economy exclusively to human economic activity and the world economy is typically judged in monetary terms, even in cases in which there is no efficient market to help valuate certain goods or services, or in cases in which a lack of independent research, genuine data or government cooperation makes establishing figures difficult. Typical examples are illegal drugs and other black market goods, which by any standard are a part of the world economy, but for which there is by definition no legal market of any kind.

However, even in cases in which there is a clear and efficient market to establish a monetary value, economists do not typically use the current or official exchange rate to translate the monetary units of this market into a single unit for the world economy since exchange rates typically do not closely reflect worldwide value, for example in cases where the volume or price of transactions is closely regulated by the government.

Rather, market valuations in a local currency are typically translated to a single monetary unit using the idea of purchasing power. This is the method used below, which is used for estimating worldwide economic activity in terms of real United States dollars or euros. However, the world economy can be evaluated and expressed in many more ways. It is unclear, for example, how many of the world's 7.8 billion people (as of March 2020)[3][4] have most of their economic activity reflected in these valuations.

According to Maddison, until the middle of 19th century, global output was dominated by China and India. Waves of Industrial Revolution in Western Europe and Northern America shifted the shares to the Western Hemisphere. As of 2020, the following 15 countries or collectives have reached an economy of at least US$2 trillion by GDP in nominal or PPP terms: Brazil, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Turkey, the United Kingdom, the United States and the European Union.[5]

Overview

World economy by country groups

country groups with individual countries designated by the IMF.[6] Members of the G-20 major economies are in bold.
List of country groups by GDP (nominal) at peak level as of 2020 in millions US$[7] List of country groups by GDP (PPP) at peak level as of 2020 in millions US$[7]
Country group GDP (nominal) Peak year Number of countries Members of G20 economies and/or largest in the group (mutually inclusive)
World 87,552,440 2019 195
Major advanced economies (G7) 39,659,165 2019 7  Canada
 France
 Germany
 Italy
 Japan
 United Kingdom
 United States
Emerging and developing Asia 21,069,339 2020 30  China
 India
 Indonesia
 Malaysia
 Philippines
 Thailand
Other advanced economies
(advanced economies excluding the G7)
12,393,950 2018 32  Australia
 South Korea
 Netherlands
 Spain
  Switzerland
 Taiwan
Latin America and the Caribbean 6,048,992 2013 33  Argentina
 Brazil
 Colombia
 Mexico
 Venezuela
Emerging and developing Europe 4,576,610 2013 16  Poland
 Russia
 Turkey
Middle East and Central Asia 3,984,677 2019 32  Egypt
 Iran
 Pakistan
 Saudi Arabia
 United Arab Emirates
Sub-Saharan Africa 1,771,952 2014 45  Nigeria
 South Africa
Country group GDP (PPP) Peak year Number of countries Members of G20 economies and/or largest in the group (Mutually exclusive)
World 134,556,917 2019 195
Major advanced economies (G7) 42,625,290 2019 7  Canada
 France
 Germany
 Italy
 Japan
 United Kingdom
 United States
Emerging and developing Asia 42,386,090 2019 30  China
 India
 Indonesia
 Malaysia
 Philippines
 Thailand
Other advanced economies
(advanced economies excluding the G7)
15,358,474 2019 32  Australia
 South Korea
 Netherlands
 Singapore
 Spain
 Taiwan
Emerging and developing Europe 10,227,416 2019 16  Poland
 Russia
 Turkey
Latin America and the Caribbean 10,159,861 2019 33  Argentina
 Brazil
 Colombia
 Mexico
 Venezuela
Middle East and Central Asia 9,655,101 2019 32  Egypt
 Iran
 Pakistan
 Saudi Arabia
 United Arab Emirates
Sub-Saharan Africa 4,144,685 2019 45  Nigeria
 South Africa

Current world economic league table of largest economies in the world by GDP and share of global economic growth

The 25 largest economies by GDP (nominal), twenty largest economies by GDP (PPP) as of 2020. Members of the G-20 major economies are in bold.
List of the 25 largest economies
by GDP (nominal) at their peak level as of 2020 in millions US$
[8]
List of the 25 largest economies
by GDP (PPP) at their peak level as of 2020 in millions US$
[9]
List of the 25 economies by highest
GDP (nominal) per capita at their peak level as of 2020 in US$
List of the 25 economies by highest
GDP (PPP) per capita at their peak level as of 2020 in US$
Rank Country Value
(USD$)
Peak year
World 87,552,440 2020
1  United States 21,433,225 2019
 European Union 19,226,235 2008
2  China 15,222,155 2020
3  Japan 6,203,212 2012
4  Germany 3,965,565 2018
5  United Kingdom 3,102,069 2007
6  France 2,929,983 2008
7  India 2,868,930 2019
8  Brazil 2,614,027 2011
9  Italy 2,408,392 2008
10  Russia 2,288,428 2013
11  Canada 1,846,595 2013
12  South Korea 1,724,846 2018
13  Spain 1,631,685 2008
14  Australia 1,569,309 2012
15  Mexico 1,315,356 2014
16  Indonesia 1,120,141 2019
17  Turkey 957,504 2013
18  Netherlands 951,766 2008
19  Saudi Arabia 792,967 2019
20   Switzerland 709,465 2014
21  Argentina 643,861 2017
22  Taiwan 635,547 2020
23  Iran 610,662 2020
24  Poland 592,401 2019
25  Sweden 586,842 2013
Rank Country Value
(USD$)
Peak year
World 134,556,917 2019
1  China 24,162,435 2020
 European Union 22,825,236 2019
2  United States 21,433,225 2019
3  India 9,542,255 2019
4  Japan 5,450,654 2019
5  Germany 4,672,006 2019
6  Russia 4,135,992 2019
7  Indonesia 3,331,872 2019
8  United Kingdom 3,254,845 2019
9  France 3,228,039 2019
10  Brazil 3,222,990 2019
11  Italy 2,665,524 2019
12  Mexico 2,625,895 2019
13  Turkey 2,471,660 2019
14  South Korea 2,304,833 2019
15  Spain 2,006,054 2019
16  Canada 1,920,997 2019
17  Saudi Arabia 1,722,862 2014
18  Australia 1,345,676 2019
19  Thailand 1,339,643 2019
20  Iran 1,337,370 2011
21  Poland 1,309,450 2019
22  Egypt 1,292,478 2020
23  Taiwan 1,275,805 2020
24  Pakistan 1,076,258 2020
25  Nigeria 1,075,694 2019
Rank Country Value
(USD$)
Peak year
1  Luxembourg 120,450 2014
2  Norway 102,577 2013
3  Qatar 101,933 2012
4   Switzerland 88,903 2011
5  Macau 86,998 2014
6  Ireland 80,504 2019
7  San Marino 79,110 2008
8  Iceland 73,868 2018
9  Australia 68,445 2012
10  Singapore 66,186 2018
11  United States 65,254 2019
12  Denmark 64,531 2008
13  Sweden 60,845 2013
14  Netherlands 58,015 2008
15  Finland 53,898 2008
16  Canada 52,744 2012
17  Austria 51,914 2008
18  United Kingdom 50,589 2007
19  Japan 48,633 2012
20  Hong Kong 48,627 2019
21  Belgium 48,493 2008
22  Germany 48,036 2014
23  Brunei 47,772 2012
24  France 47,155 2008
25  Kuwait 45,726 2012
Rank Country Value
(USD$)
Peak year
1  Qatar 169,698 2012
2  Macau 145,992 2013
3  Luxembourg 120,490 2019
5  United Arab Emirates 110,114 2004
4  Singapore 101,458 2019
6  Ireland 91,959 2019
7  Brunei 88,312 2012
8  San Marino 74,942 2008
9  Kuwait 72,736 2012
10   Switzerland 72,008 2019
11  Norway 66,742 2013
12  United States 65,254 2019
13  Hong Kong 62,267 2019
14  Denmark 59,719 2019
15  Netherlands 59,693 2019
16  Iceland 58,965 2019
17  Austria 58,850 2019
18  Saudi Arabia 57,284 2012
19  Germany 56,226 2019
20  Sweden 55,265 2019
21  Bahrain 54,489 2012
22  Belgium 54,029 2019
23  Taiwan 54,020 2020
24  Australia 52,726 2019
25  Canada 51,190 2019

Twenty largest economies in the world by nominal GDP

The following is a list of the twenty largest economies by nominal GDP at peak value as of the specific year according to the International Monetary Fund.[10]
Rank 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
1  United States  United States  United States  United States  United States  United States  United States  United States  United States  United States
2  Soviet Union  Soviet Union  Japan  Japan  Japan  Japan  China  China  China  China
3  Japan  Japan  Soviet Union  Germany  Germany  Germany  Japan  Japan  Japan  Japan
4  West Germany  West Germany  West Germany  France  United Kingdom  United Kingdom  Germany  Germany  Germany  Germany
5  France  France  France  United Kingdom  France  China  United Kingdom  United Kingdom  United Kingdom  India
6  United Kingdom  United Kingdom  United Kingdom  Italy  Italy  France  France  France  France  France
7  Italy  Italy  Italy  Brazil  China  Italy  Italy  Brazil  India  United Kingdom
8  Canada  Canada  Canada  China  Brazil  Canada  Brazil  Italy  Brazil  Brazil
9  China  China  Iran  Spain  Canada  Spain  Russia  Russia  Italy  Italy
10  Argentina  Mexico  Spain  Canada  Mexico  South Korea  India  India  Russia  Russia
Rank 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
11  Spain  India  China  Iran  Spain  Brazil  Spain  Canada  Canada  Canada
12  Mexico  Argentina  Brazil  South Korea  South Korea  Mexico  Canada  Spain  South Korea  South Korea
13  Netherlands  Spain  India  Mexico  Iran  India  Australia  Australia  Spain  Spain
14  India  Brazil  Australia  Netherlands  India  Russia  South Korea  South Korea  Australia  Australia
15  Saudi Arabia  Australia  Netherlands  Australia  Netherlands  Australia  Mexico  Mexico  Mexico  Indonesia
16  Australia  Netherlands  Mexico  India  Russia  Netherlands  Netherlands  Turkey  Indonesia  Mexico
17  Brazil  Saudi Arabia  South Korea   Switzerland  Australia  Iran  Turkey  Netherlands  Turkey  Netherlands
18  Sweden  Iran  Sweden  Russia   Switzerland  Turkey  Indonesia  Indonesia  Netherlands  Turkey
19  Belgium  Sweden   Switzerland  Argentina  Argentina   Switzerland   Switzerland  Saudi Arabia  Saudi Arabia   Switzerland
20   Switzerland  Belgium  Argentina  Belgium  Taiwan  Sweden  Iran   Switzerland   Switzerland  Saudi Arabia

Twenty largest economies in the world by GDP (PPP)

List of twenty largest economies by GDP based on purchasing power parity at peak value as of the specific year according to the International Monetary Fund and the CIA World Factbook.[11][12]
Rank 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
1  United States  United States  United States  United States  United States  United States  United States  United States  China  China
2  Soviet Union  Soviet Union  Soviet Union  Japan  China  China  China  China  United States  United States
3  Japan  Japan  Japan  China  Japan  Japan  India  India  India  India
4  West Germany  West Germany  West Germany  Germany  Germany  India  Japan  Japan  Japan  Japan
5  Italy  Italy  Italy  Russia  India  Germany  Germany  Germany  Germany  Germany
6  France  France  France  India  France  Russia  Russia  Russia  Russia  Russia
7  Brazil  Brazil  China  Italy  Italy  France  Brazil  Brazil  Indonesia  Indonesia
8  United Kingdom  United Kingdom  Brazil  France  Russia  Brazil  France  United Kingdom  United Kingdom  Brazil
9  Saudi Arabia  China  United Kingdom  Brazil  Brazil  United Kingdom  United Kingdom  France  France  United Kingdom
10  Mexico  India  India  United Kingdom  United Kingdom  Italy  Italy  Indonesia  Brazil  France
Rank 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
11  India  Mexico  Mexico  Mexico  Mexico  Mexico  Indonesia  Italy  Italy  Turkey
12  China  Saudi Arabia  Spain  Indonesia  Indonesia  Indonesia  Mexico  Mexico  Mexico  Mexico
13  Spain  Canada  Canada  Spain  Spain  Spain  South Korea  Turkey  Turkey  Italy
14  Canada  Spain  Indonesia  Saudi Arabia  Canada  Canada  Spain  South Korea  South Korea  South Korea
15  Iran  Iran  Saudi Arabia  Canada  Saudi Arabia  South Korea  Saudi Arabia  Saudi Arabia  Spain  Spain
16  Indonesia  Indonesia  Iran  South Korea  South Korea  Saudi Arabia  Canada  Spain  Canada  Canada
17  Argentina  Turkey  Turkey  Turkey  Turkey  Turkey  Turkey  Canada  Saudi Arabia  Saudi Arabia
18  Poland  Australia  Australia  Iran  Iran  Iran  Iran  Iran  Australia  Egypt
19  Netherlands  Netherlands  South Korea  Australia  Australia  Australia  Australia  Australia  Thailand  Thailand
20  Turkey  Argentina  Netherlands  Thailand  Netherlands  Thailand  Taiwan  Taiwan  Iran  Poland

Statistical indicators

Finance

Countries by total wealth (trillions USD), Credit Suisse
Countries by total wealth (trillions USD), Credit Suisse

Employment

World GDP per capita between 1500 and 2000 (log scale)
World GDP per capita between 1500 and 2000 (log scale)
World GDP per capita between 1500 and 2003
World GDP per capita between 1500 and 2003
GDP increase, 1990–1998 and 1990–2006, in major countries
GDP increase, 1990–1998 and 1990–2006, in major countries
  • Unemployment rate: 8.7% (2009 est.). 30% (2007 est.) combined unemployment and underemployment in many non-industrialized countries; developed countries typically 4%–12% unemployment.

Industries

  • Industrial production growth rate: 3% (2002 est.)

Energy

Global primary energy consumption, measured in terawatt-hours (TWh) per year
Global primary energy consumption, measured in terawatt-hours (TWh) per year
  • Yearly electricity – production: 21,080,878 GWh (2011 est.),[18] 15,850,000 GWh (2003 est.), 14,850,000 GWh (2001 est.)
  • Yearly electricity – consumption: 14,280,000 GWh (2003 est.), 13,930,000 GWh (2001 est.)
  • Oil – production: 79,650,000 bbl/d (12,663,000 m3/d) (2003 est.), 75,460,000 barrels per day (11,997,000 m3/d) (2001)
  • Oil – consumption: 80,100,000 bbl/d (12,730,000 m3/d) (2003 est.), 76,210,000 barrels per day (12,116,000 m3/d) (2001)
  • Oil – proved reserves: 1.025 trillion barrel (163 km3) (2001 est.)
  • Natural gas – production: 3,366 km3 (2012 est.),[19] 2,569 km3 (2001 est.)
  • Natural gas – consumption: 2,556 km3 (2001 est.)
  • Natural gas – proved reserves: 161,200 km3 (1 January 2002)

Cross-border

  • Yearly exports: $12.4 trillion, €11.05 trillion (2009 est.)
  • Exports – commodities: the whole range of industrial and agricultural goods and services
  • Exports – partners: US 12.7%, Germany 7.1%, China 6.2%, France 4.4%, Japan 4.2%, UK 4.1% (2008)
  • Yearly imports: $12.29 trillion, €10.95 trillion (2009 est.)
  • Imports – commodities: the whole range of industrial and agricultural goods and services
  • Imports – partners: China 10.3%, Germany 8.6%, US 8.1%, Japan 5% (2008)
  • Debt – external: $56.9 trillion, €40 trillion (31 December 2009 est.)

Gift economy

Communications

Telephones – main lines in use: 843,923,500 (2007)
4,263,367,600 (2008)

Transport

Transportation infrastructure worldwide includes:

Military

A pie chart showing global military expenditures by country for 2018, in US$ billions, according to SIPRI.
A pie chart showing global military expenditures by country for 2018, in US$ billions, according to SIPRI.
  • World military expenditure in 2018: estimated to $1.822 trillion [24]
  • Military expenditures – percent of GDP: roughly 2% of gross world product (1999).

Science, research and development

Number of scientific or technical journal article publications per million residents as of 2013.
Number of scientific or technical journal article publications per million residents as of 2013.

The Royal Society in a 2011 report stated that in terms of number of papers the share of English-language scientific research papers the United States was first followed by China, the UK, Germany, Japan, France, and Canada.[25] In 2015, research and development constituted an average 2.2% of the global GDP according to the UNESCO Institute for Statistics.[26] Metrics and rankings of innovation include the Bloomberg Innovation Index, the Global Innovation Index and the share of Nobel laureates per capita.

Resources and environment

Shown is how the global material footprint and global CO2 emissions from fossil-fuel combustion and industrial processes changed compared with global GDP.[27]
Deforestation (net loss) of tropical rainforest and woodland over time, 1750-2004
Deforestation (net loss) of tropical rainforest and woodland over time, 1750-2004
  • Forests (carbon sinks, wood, ecosystem services, ...)
    • Estimated number of trees that are net lost annually as of 2020: 10 billion[28][29]
    • Global annual deforested land in 2015–2020: 10 million hectares
    • Global annual net forest area loss in 2000–2010 : 4.7 million hectares[30]
  • Other land degradation and land- and organisms-related ecosystem disturbances
    • Soils (carbon sink, ecosystem services, food production, ...)
      • Soil erosion by water in 2012: almost 36 billion tons (based on a high resolution global potential soil erosion model developed in 2017)[31]
      • Estimated annual loss of agricultural productivity due to soil erosion: 8 billion US dollars (based on the soil erosion data)[32]
      • Soil erosion by water in 2015: approximately 43 billion tons (according to a 2020 study)[33]
      • Environmental impact of pesticides
        • Pesticide use in tonnes of active ingredient in Australia in 2016: ca. 62,500 tonnes[34]
  • Oceans (ecosystem services, food production, ...): Blue economy
  • Waste and pollution (effects of economic mechanisms, effects on ecosystem services)
    • As of 2018, about 380 million tonnes of plastic is produced worldwide each year. From the 1950s up to 2018, an estimated 6.3 billion tonnes of plastic has been produced worldwide, of which an estimated 9% has been recycled and another 12% has been incinerated with the rest reportedly being "dumped in landfills or the natural environment".[35]
    • Air pollution
      • Number of human deaths caused annually by air pollution worldwide: ca. 7 million[36][37][38]
      • Estimated global annual cost of air pollution: $5 trillion[39][40][41]
    • Microplastic pollution
      • Estimated accumulated number of microplastic particles in the North Atlantic Ocean in 2014: 15 to 51 trillion particles, weighing between 93,000 and 236,000 metric tons[42]
      • Estimated accumulated number of microplastic particles in the North Atlantic Ocean in 2020: 3700 microplastics per cubic meter[42]

From the scientific perspective, economic activities are embedded in a web of dynamic, interrelated, and interdependent activities that constitute the natural system of Earth. Novel application of cybernetics in decision-making (such as in decision-making related to process- and product-design and related laws) and direction of human activity (such as economic activity) may make it easier to control modern ecological problems.[43]

Historical development

Estimations of world population and GDP from a 2020 research paper[44]
Year Population
(million)
GDP per capita
(1990 $ in PPP)
GDP in billion
(1990 $ in PPP)
1000000 BCE 0.125 400 0.05
300000 BCE 1 400 0.40
25000 BCE 3.34 400 1.34
10000 BCE 4 400 1.60
5000 BCE 5 404 2.02
4000 BCE 7 409 2.87
3000 BCE 14 421 5.90
2000 BCE 27 433 11.7
1000 BCE 50 444 22.2
500 BCE 100 457 45.7
200 BCE 150 465 69.7
1 168 467 78.4
200 190 463 88.0
400 190 463 88.0
500 190 463 88.0
600 200 462 92.3
700 210 460 96.6
800 220 459 101
900 240 456 109
1000 265 453 120
1100 320 512 164
1200 360 551 198
1300 360 551 198
1400 350 541 190
1500 438 625 274
1600 556 629 350
1700 603 658 397
1820 1,042 712 741
1870 1,276 884 1,128
1900 1,563
1913 1,793 1,543 2,767
1920 1,863
1940 2,299 2,181 5,013
1950 2,528 2,104 5,318
1960 3,042 2,764 12,170
1970 3,691 3,725 13,751
1980 4,440 4,511 20,026
1990 5,269 5,149 27,133
2000 6,077 6,057 36,806
2010 6,873 7,814 53,704
2019 7,620 9,663 73,640

One example for a comparable metric other than GDP are the OECD Better Life Index rankings for different aggregative domains.

Legend
  Explained by: Housing
  Explained by: Income
  Explained by: Jobs
  Explained by: Community
  Explained by: Education
  Explained by: Environment
  Explained by: Civic engagement
  Explained by: Health
  Explained by: Life Satisfaction
  Explained by: Safety
  Explained by: Work-Life Balance
OECD Better Life Index rankings for 2016
Overall Rank
[45]
Country Housing Income Jobs Community Education Environment Civic engagement Health Life Satisfaction Safety Work-Life Balance
1  Norway
2  Australia
3  Denmark
4   Switzerland
5  Canada
6  Sweden
7  New Zealand
8  Finland
9  United States
10  Iceland
11  Netherlands
12  Germany
13  Luxembourg
14  Belgium
15  Austria
16  United Kingdom
17  Ireland
18  France
19  Spain
20  Slovenia
21  Czech Republic
22  Estonia
23  Japan
24  Slovakia
25  Italy
26  Israel
27  Poland
28  South Korea
29  Portugal
30  Latvia
31  Greece
32  Hungary
33  Russia
34  Chile
35  Brazil
36  Turkey
37  Mexico
38  South Africa

The index includes 11 comparable "dimensions" of well-being:[46]

  1. Housing: housing conditions and spendings (e.g. real estate pricing)
  2. Income: household income (after taxes and transfers) and net financial wealth
  3. Jobs: earnings, job security and unemployment
  4. Community: quality of social support network
  5. Education: education and what one gets out of it
  6. Environment: quality of environment (e.g. environmental health)
  7. Governance: involvement in democracy
  8. Health
  9. Life Satisfaction: level of happiness
  10. Safety: murder and assault rates
  11. Work-life balance

Economic studies

To promote exports, many government agencies publish on the web economic studies by sector and country. Among these agencies include the USCS (US DoC) and FAS (USDA) in the United States, the EDC and AAFC in Canada, Ubifrance in France, the UKTI in the United Kingdom, the HKTDC and JETRO in Asia, Austrade and the NZTE in Oceania. Through Partnership Agreements, the Federation of International Trade Associations publishes studies from several of these agencies (USCS, FAS, AAFC, UKTI, and HKTDC) as well as other non-governmental organizations on its website globaltrade.net.

See also

Timeline of world economy
-10000 —
-9500 —
-9000 —
-8500 —
-8000 —
-7500 —
-7000 —
-6500 —
-6000 —
-5500 —
-5000 —
-4500 —
-4000 —
-3500 —
-3000 —
-2500 —
-2000 —
-1500 —
-1000 —
-500 —
0 —
500 —
1000 —
1500 —
2000 —
Mesolithic
Neolithic
Bronze Age
Iron Age
Classical Antiquity
Middle Ages
Early Modern Era
Industrial Revolution
20th Century

Regional economies:

Events:

Lists:

References

  1. ^ "THE GLOBAL ECONOMY | definition in the Cambridge English Dictionary". dictionary.cambridge.org. Retrieved 20 September 2020.
  2. ^ "World Economy." – Definition. American English Definition of with Pronunciation by Macmillan Dictionary. N.p., n.d. Web. 02 Jan. 2015.
  3. ^ World Population: 2020 Overview
  4. ^ 2020 World Population Data Sheet
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