Markets
Visualizing the Composition of the World Economy by GDP (PPP)
The Composition of the World Economy by GDP (PPP)
Earlier this month, we showed you the world’s $86 trillion economy broken down by country, using nominal GDP calculations.
While this is one useful way to view the global economic picture, it’s not the only way.
Today’s visualization, which comes to us from HowMuch.net, is similar in that it also uses a Voronoi diagram to display the composition of the world economy by GDP. However, by adjusting data for purchasing power parity (PPP), it produces a very different view of how global productivity breaks down.
What is PPP?
Purchasing power parity, or PPP, is an economic theory that can be applied to adjust the prices of goods in a given market.
In essence, instead of using current market rates for prices (such as in nominal data), PPP tries to more accurately account for differences in the cost of living between countries – especially in places where labor and goods are far cheaper.
When applied to GDP measurements, PPP can help provide a more accurate picture of actual productivity. For example, a taxi ride in Bolivia may be far cheaper than one in New York City, even though it is the same service provided over the same distance.
Applying PPP to GDP figures can help correct for these types of differences.
Ranked: Economies by GDP (PPP)
After adjusting for PPP, how does the composition of the global economy change from the nominal numbers?
Below are the 15 largest economies by GDP (PPP), as well as how their ranking changed from the previous chart, which used nominal data.
Rank | Country | GDP (2018, PPP) | Share of World Total | Change (vs. nominal rank) |
---|---|---|---|---|
#1 | 🇨🇳 China | $25.4 trillion | 18.6% | +1 |
#2 | 🇺🇸 United States | $20.5 trillion | 15.0% | -1 |
#3 | 🇮🇳 India | $10.5 trillion | 7.7% | +4 |
#4 | 🇯🇵 Japan | $5.5 trillion | 4.0% | -1 |
#5 | 🇩🇪 Germany | $4.5 trillion | 3.3% | -1 |
#6 | 🇷🇺 Russia | $4.0 trillion | 2.9% | +5 |
#7 | 🇮🇩 Indonesia | $3.5 trillion | 2.6% | +9 |
#8 | 🇧🇷 Brazil | $3.4 trillion | 2.5% | +1 |
#9 | 🇬🇧 United Kingdom | $3.1 trillion | 2.3% | -4 |
#10 | 🇫🇷 France | $3.1 trillion | 2.3% | -4 |
#11 | 🇮🇹 Italy | $2.5 trillion | 1.9% | -3 |
#12 | 🇲🇽 Mexico | $2.5 trillion | 1.9% | +3 |
#13 | 🇹🇷 Turkey | $2.4 trillion | 1.7% | +6 |
#14 | 🇰🇷 Korea, Rep. | $2.1 trillion | 1.5% | -2 |
#15 | 🇪🇸 Spain | $1.9 trillion | 1.4% | -1 |
Using GDP (PPP), the world economy is worth $136.5 trillion in current international U.S. dollars.
What changed the most from the nominal ranking?
With PPP, you can see Indonesia ($3.5 trillion) jumps up the ranking by nine spots to become the #7 ranked economy. Likewise, Turkey ($2.4 trillion) and India ($10.5 trillion) both climb the ranking by six and four spots respectively. China also switches with the U.S., to become the world’s largest economy.
On the flipside, it is often the more developed economies with strong currencies that see a drop in their rankings. After adjusting for PPP, the United States, Japan, Germany, France, Italy, South Korea, Spain, and the U.K. all slip from their previous positions.
For more on GDP (PPP), see the projections for the world’s largest 10 economies in 2030 that we published earlier this year.
Markets
The Fastest Rising U.S. Housing Markets in 2024
As U.S. home prices hit record highs, which housing market is seen the fastest growth? This graphic shows the top 10 across the country.
The Fastest Rising U.S. Housing Markets in 2024
This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.
The U.S. housing market has been on a tear, with median sales prices rising more than 40% since February 2020.
While cities in southern states like Florida have witnessed some of the strongest price growth, more affordable cities across the Midwest are also seeing growing demand as buyers seek out cheaper options.
This graphic shows the U.S. metros with the fastest price growth, based on data from Redfin.
Hottest Housing Markets in America
Below, we rank the metropolitan areas with the fastest annual median sales price growth as of February 2024:
Rank | Metro | Median Sales Price Growth Feb 2024 YoY |
---|---|---|
1 | Pittsburgh, PA | +22.0% |
2 | Fort Lauderdale, FL | +18.0% |
3 | Greensboro, NC | +17.8% |
4 | Meridian, ID | +17.3% |
5 | Toledo, OH | +17.0% |
6 | Boca Raton, FL | +16.4% |
7 | West Palm Beach, FL | +16.1% |
8 | Orlando, FL | +15.9% |
9 | Milwaukee, WI | +15.6% |
10 | Alexandria, VA | +15.4% |
U.S. average | +6.5% |
Pittsburgh, PA soars to the top of the list, with median sale prices jumping 22% over the year.
Once known as a center for steel and iron manufacturing, the city has emerged as a hub for high-tech industries including robotics, software engineering, and healthcare. At a time when housing affordability is near record lows, buyers have flocked to the market thanks to its lower home prices. In February, median sales prices in Pittsburgh were $250,000 compared to the U.S. median price of $412,219.
Following next in line is Fort Lauderdale, FL with prices jumping 18% annually. Like several cities across the state, property values have boomed thanks to the state’s warm climate and low taxes. The state also ranks as one of the best in the country to retire. In 2023, it was one of the fastest growing states in the country, adding 365,205 residents overall.
As we can see, just one housing market in the West, Meridian, ID, is experiencing some of the strongest price growth in the country. Since the pandemic, many Californians priced out of expensive real estate markets have moved to the state due to its strong job market, low crime rate, and affordability. In fact, Los Angeles and San Fransisco are some of the top metropolitan areas nationally that people are moving away from due to remote-work trends and the high cost of living.
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