What does it mean for a nation to be rich or poor at a time of global pandemic? GDP per capita adjusted for relative purchasing power gives us an idea, albeit an imperfect one.

Author: Luca Ventura
Project Coordinator: Binh P
Luxembourg on the left is the world's richest country and Burundi on the right is the poorest.

Would you rather be rich in a poor country or poor in a rich one? Measuring how rich a country is not that easy (spoiler: it is not just about the GDP). Measuring how rich you are depends to a large degree on how rich and poor countries are defined.

If we simply consider a nation's gross domestic product—the sum of all goods and services produced by a country during one year—then we would have to conclude that the richest nations are exactly the ones with the largest GDP: United States, China, Japan, Germany. But how could the economies, for example, of Singapore or Luxembourg ever match that of such powerhouses when they are no more than small dots on the world map?

Another problem with GDP is that it does not measure wealth distribution. That is why a more accurate representation of people’s living conditions begins with dividing a nation's GDP by the number of people that live there: per capita GDP and its growth rate tell us much more about the social wealth potentially available to each person and whether this wealth is either increasing or decreasing over time.

However, using per capita GDP still poses a problem: the very same income can buy very little in some countries and go much further in others where basic necessities—food, clothing, shelter, or healthcare—cost far less. To gauge how a country’s citizens are wealthy it is necessary to understand how much they can buy. That is why, when comparing per capita GDP across countries, the GDP should be adjusted for purchasing power parity, which helps us take into account the inflation rates and the price of goods and services in each given place.

In conclusion, then, when considering whether it is better to be rich in a poor country or poor in a rich one, the best chance of enjoying a superior standard of living is to reside in a richer nation no matter where a person falls on the income distribution scale.  The coronavirus pandemic proved it most strikingly. Low-income workers, often migrants, living in very wealthy nations suddenly found themselves unemployed, homeless and stranded. By contrast, some poor and developing nations were spared, or cleverly prevented, the worst health and socio-economic effects of the outbreak, allowing their citizens to continue their lives in a mostly unchanged way. Whether you are rich or you are poor, these—indeed—are very strange and frightening times.


Rank

Country

GDP-PPP ($)

1 Luxembourg 118,001
2 Singapore 97,057
3 Ireland 94,392
4 Qatar 93,508
5 Switzerland 72,874
6 Norway 65,800
7 United States 63,416
8 Brunei Darussalam 62,371
9 Hong Kong SAR 59,520
10 Denmark 58,932
11 United Arab Emirates 58,753
12 San Marino 58,427
13 Netherlands 57,534
14 Macao SAR 56,078
15 Iceland 55,596
16 Taiwan Province of China 55,724
17 Austria 55,218
18 Sweden 54,146
19 Germany 54,076
20 Australia 51,680
21 Belgium 51,096
22 Finland 49,853
23 Bahrain 48,766
24 Canada 48,720
25 Saudi Arabia 46,811
26 France 46,062
27 Korea 44,621
28 United Kingdom 44,117
29 Malta 42,856
30 Japan 42,248
31 New Zealand 42,018
32 Kuwait 41,627
33 Italy 40,861
34 Czech Republic 40,618
35 Israel 40,547
36 Cyprus 40,107
37 Lithuania 38,824
38 Slovenia 40,067
39 Spain 39,121
40 Estonia 38,834
41 Poland 34,103
42 Portugal 34,043
43 Puerto Rico 34,025
44 The Bahamas 34,148
45 Hungary 33,030
46 Slovak Republic 32,709
47 Latvia 31,509
48 Romania 30,526
49 Turkey 30,253
50 Oman 30,178
51 Aruba 29,090
52 Greece 28,748
53 Russia 27,903
54 Croatia 27,717
55 Malaysia 27,402
56 Panama 27,003
57 Kazakhstan 26,565
58 Seychelles 25,414
59 Trinidad and Tobago 25,031
60 Bulgaria 23,817
61 Chile 23,366
62 Uruguay 22,459
63 St. Kitts and Nevis 20,987
64 Argentina 20,751
65 Mauritius 20,292
66 Belarus 20,187
67 Costa Rica 19,990
68 Guyana 19,684
69 Maldives 19,609
70 Montengegro 19,252
71 Serbia 19,146
72 Mexico 19,130
73 Antigua and Barbuda 18,618
74 Dominican Republic 18,608
75 Thailand 18,236
76 Equatorial Guinea 17,788
77 China 17,192
78 Botswana 16,893
79 North Macedonia 16,712
80 Turkmenistan 16,520
81 Gabon 15,970
82 Grenada 15,431
83 Bosnia and Herzegovina 15,047
84 Georgia 14,918
85 Brazil 14,916
86 Suriname 14,513
87 Azerbaijan 14,431
88 Colombia 14,324
89 Palau 14,309
90 Albania 14,218
91 Barbados 13,553
92 St. Lucia 13,359
93 Armenia 13,261
94 Sri Lanka 13,214
95 Ukraine 13,110
96 Iran 13,073
97 Paraguay 12,881
98 Moldova 12,811
99 Egypt 12,790
100 St. Vincent and the Grenadines 12,606
101 Indonesia 12,222
102 Bhutan 12,060
103 South Africa 12,032
104 Peru 11,871
105 Mongolia 11,825
106 Fiji 11,567
107 Lebanon 11,564
108 Kosovo 11,274
109 Algeria 11,112
110 Dominica 11,072
111 Ecuador 11,009
112 Vietnam 10,869
113 Jordan 10,306
114 Tunisia 10,120
115 Iraq 10,003
116 Jamaica 9,975
117 Nauru 9,856
118 Namibia 9,396
119 Eswatini 8,957
120 Philippines 8,452
121 El Salvador 8,422
122 Bolivia 8,344
123 Guatemala 8,293
124 Lao P.D.R.  8,111
125 Morocco 7,620
126 Uzbekistan 7,449
127 Angola 6,932
128 India 6,461
129 Cabo Verde 6,424
130 Tonga 6,191
131 Belize 6,046
132 Libya 5,893
133 Mauritania 5,834
134 Ghana 5,693
135 Samoa 5,653
136 Nicaragua 5,575
137 Honduras 5,450
138 West Bank and Gaza 5,388
139 Côte d'Ivoire 5,365
140 Bangladesh 5,307
141 Myanmar 5,242
142 Nigeria 5,187
143 Venezuela 5,178
144 Pakistan 5,150
145 Djibouti 5,096
146 Kyrgyz Republic 5,036
147 Kenya 4,926
148 Cambodia 4,695
149 Tuvalu 4,497
150 Republic of Congo 4,188
151 Sudan 4,098
152 Nepal 4,061
153 Papau new Guinea 3,833
154 São Tomé and Príncipe 3,829
155 Marshall Islands 3,786
156 Tajikistan 3,676
157 Cameroon 3,646
158 Senegal 3,478
159 Micronesia 3,446
160 Benin 3,437
161 Timor-Leste 3,382
162 Zambia 3,342
163 Comoros 3,048
164 Haiti 2,916
165 Ethiopia 2,908
166 Tanzania 2,821
167 Lesotho 2,718
168 Zimbabwe 2,622
169 Guinea 2,604
170 Vanuatu 2,586
171 Uganda 2,574
172 Solomon Islands 2,455
173 Mali 2,401
174 Afghanistan 2,390
175 Guinea-Bissau 2,348
176 Rwanda 2,337
177 The Gambia 2,276
178 Burkina Faso 2,262
179 Kiribati 2,200
180 Togo 2,199
181 Yemen 1,927
182 Eritrea 1,821
183 Sierra Leone 1,725
184 Chad 1,611
185 Madagascar 1,599
186 Liberia 1,557
187 Mozambique 1,277
188 Niger 1,259
189 Democratic Republic of Congo 1,106
190 Malawi 993
191 Central African Republic 979
192 Somalia 925
193 South Sudan 791
194 Burundi 760

Source: International Monetary Fund, World Economic Outlook April 2021. Values are expressed in current international dollars, reflecting the corresponding exchange rates and PPP adjustments.