The Diversity of Countries and Economies across the World

Self-Check Questions

Using the data in Table, rank the seven regions of the world according to GDP and then according to GDP per capita.

Population (in millions) GDP Per Capita GDP = Population × Per Capita GDP (in millions)
East Asia and Pacific 2,006 $5,536 $10,450,032
South Asia 1,671 $1,482 $2,288,812
Sub-Saharan Africa 936.1 $1,657 $1,287,650
Latin America and Caribbean 588 $9,536 $5,339,390
Middle East and North Africa 345.4 $3,456 $1,541,900
Europe and Central Asia 272.2 $7,118 $1,862,384
GDP and Population of Seven Regions of the World

Hint:

The answers are shown in the following two tables.

Region GDP (in millions)
East Asia $10,450,032
Latin America $5,339,390
South Asia $2,288,812
Europe and Central Asia $1,862,384
Middle East and North Africa $1,541,900
Sub-Saharan Africa $1,287,650
Region GDP Per Capita (in millions)
East Asia $5,246
Latin America $1,388
South Asia $1,415
Europe and Central Asia $9,190
Middle East and North Africa $4,535
Sub-Saharan Africa $6,847

East Asia appears to be the largest economy on GDP basis, but on a per capita basis it drops to third, after Europe and Central Asia and Sub-Saharan Africa.

What are the drawbacks to analyzing the global economy on a regional basis?

Hint:

A region can have some of high-income countries and some of the low-income countries. Aggregating per capita real GDP will vary widely across countries within a region, so aggregating data for a region has little meaning. For example, if you were to compare per capital real GDP for the United States, Canada, Haiti, and Honduras, it looks much different than if you looked at the same data for North America as a whole. Thus, regional comparisons are broad-based and may not adequately capture an individual country’s economic attributes.