World competitiveness rankings

The latest World Competitiveness Yearbook is in. While all rankings need to be taken with a grain of salt, they still give some information. In this case, over 300 indicators relating to economic performance, infrastructure, government and business efficiency are collected. While one can discuss the methodology of aggregating these indicators, the yearbook has value in the compilation of this wealth of data.

The USA is number 1 again this year (see the 2008 "scoreboard", from 2007 data), followed by a series of smaller nations (Singapore, Hong Kong, Switzerland, Luxembourg). In fact, it is somewhat puzzling that so many small countries are ahead of the larger European countries. Germany is 16th, just ahead of China, the UK 21st. In that respect, the USA is an anomaly.

Will it last? Twenty years ago, the USA was 3rd, well behind Japan and Switzerland. If Japan managed to drop all the way to 22nd, The US could as well, and the current pessimistic mood may indicate that. Especially as Japan was then hit by low interest rates and a major banking crisis...