World economy


The world economy or global economy is the economy of all humans in the world, referring to the global economic system, which includes all economic activities conducted both within and between nations, including production, consumption, economic management, work in general, financial transactions and trade of goods and services. In some contexts, the two terms are distinct: the "international" or "global economy" is 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 calculating 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.
Even in cases in which there is a clear and efficient market to establish 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. For example, it is unclear how many of the world's 7.8 billion people, as of 2020, have most of their economic activity reflected in these valuations.
Until the middle of the 19th century, global output was dominated by China and India. Waves of the Industrial Revolution in Western Europe and Northern America shifted the shares to the Western Hemisphere. As of 2025, the following 12 countries and 2 collectives account for at least 2.0% of global economy by either Gross Domestic Product in nominal or Purchasing Power Parity terms: Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Russia, the United Kingdom, the United States, the European Union and the African Union.
Between 1820 and 2000, global income inequality increased with almost 50%; however, this change occurred mostly before 1950. Afterwards, the level of inequality remained mostly stable. It is important to differentiate between between-country inequality, which was the driving force for this pattern, and within country inequality, which remained largely constant. Global income inequality peaked approximately in the 1970s, when world income was distributed bimodally into "rich" and "poor" countries with little overlap. Since then, inequality has been rapidly decreasing, and this trend seems to be accelerating. Income distribution is now unimodal, with most people living in middle-income countries.
In the 2000s, a study by the World Institute for Development Economics Research at United Nations University found that the richest 1% of adults owned 40% of global assets, and that the richest 10% of adults accounted for 85% of the world total. The bottom half of the world adult population owned barely 1% of global wealth. Oxfam International reported that the richest 1 percent of people owned 48 percent of global wealth, and would own more than half of global wealth by 2016. In 2014, Oxfam reported that the 85 wealthiest individuals in the world had a combined wealth equal to that of the bottom half of the world's population, or about 3.5 billion people. Despite high levels of government investment, the global economy decreased by 3.4% in 2020 in the midst of the COVID-19 pandemic, an improvement from the World Bank's initial prediction of a 5.2 percent decrease. Cities account for 80% of global GDP, thus they faced the brunt of this decline. The world economy increased again in 2021 with an estimated 5.5 percent rebound.

Overview

World economy by country groups

World economy by continent

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

Twenty largest economies in the world by nominal GDP

Twenty largest economies in the world by GDP (PPP)

Statistical indicators

Finance

  • GDP : – $110.06 trillion, $117.165 trillion . The GWP is the combined gross national income of all the countries in the world. When calculating the GWP, add GDP of all countries. Also, GWP shows that imports and exports are equal. Because imports and exports balance exactly when considering the whole world, this also equals the total global gross domestic product.
  • GDP : – $60.69 trillion. The market exchange rates increased from 1990 to 2008. The reason for this increase is the world's advancement in terms of technology.
  • GDP : The following part shows the GDP growth rate and the expected value after one year.
  • * Developed Economies. A developed country, industrialized country, more developed country, or more economically developed country, is a sovereign state that has a developed economy and advanced technological infrastructure relative to other less industrialized nations. Most commonly, the criteria for evaluating the degree of economic development are gross domestic product, gross national product, the per capita income, level of industrialization, amount of widespread infrastructure and general standard of living. Which criteria are to be used and which countries can be classified as being developed are subjects of debate. The GDP of the developed countries is predicted to fall from 2.2% in 2017 to 2.0% in 2018 due to the fall in dollar value.
  • * Developing Countries. A developing country is a country with a less developed industrial base and a low Human Development Index relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreement on which countries fit this category. A nation's GDP per capita, compared with other nations, can also be a reference point. In general, the United Nations accepts any country's claim of itself being "developing". The GDP of the developing countries is expected to rise from 4.3% in 2017 to 4.6% in 2018 due to political stability in those countries and advancement in technology.
  • * Least developed countries. The least developed countries is a list of developing countries that, according to the United Nations, exhibit the lowest indicators of socioeconomic development, with the lowest Human Development Index ratings of all countries in the world. The concept of LDCs originated in the late 1960s and the first group of LDCs was listed by the UN in its resolution 2768 of 18 November 1971. This is a group of countries that are expected to improve their GDP from 4.8% in 2017 to 5.4% in 2018. The predicted growth is associated advancement in technology and industrialization of those countries for the past decade.
  • GDP – per capita: purchasing power parity – $9,300, €7,500, $8,200, €6,800 , $7,900, €5,000
  • World median income: purchasing power parity $1,041, €950
  • GDP – composition by sector: agriculture: 4%; industry: 32%; services: 64%
  • Inflation rate ; In economics, inflation is a general rise in the price level in an economy over a period of time, resulting in a sustained drop in the purchasing power of money. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation reflects a reduction in the purchasing power per unit of money – a loss of real value in the medium of exchange and unit of account within the economy. The opposite of inflation is deflation, a sustained decrease in the general price level of goods and services. The common measure of inflation is the inflation rate, the annualized percentage change in a general price index, usually the consumer price index, over time. national inflation rates vary widely in individual cases, from declining prices in Japan to hyperinflation in several Third World countries :
  • * World 2.6%, 2.8% ;
  • * Developed Economies 1% to 4% typically
  • * Developing Countries 5% to 60% typically
  • * Least developed countries 11.4%, 8.3%
  • Derivatives OTC outstanding notional amount: $601 trillion
  • Derivatives exchange traded outstanding notional amount: $82 trillion
  • Global debt issuance: $5.187 trillion, €3 trillion, $4.938 trillion, €3.98 trillion, $3.938 trillion
  • Global equity issuance: $505 billion, €450 billion, $388 billion. €320 billion, $319 billion, €250 trillion

    Employment

  • Unemployment rate: 8.7%. 30% combined unemployment and underemployment in many non-industrialized countries; developed countries typically 4%–12% unemployment.

    Industries

  • Industrial production growth rate: 3%

    Energy

  • Yearly electricity – production: 21,080,878 GWh, 15,850,000 GWh, 14,850,000 GWh
  • Yearly electricity – consumption: 14,280,000 GWh, 13,930,000 GWh
  • Oil – production: ,
  • Oil – consumption: ,
  • Oil – proved reserves: 1.025 trillion barrel
  • Natural gas – production: ,
  • Natural gas – consumption:
  • Natural gas – proved reserves:

    Cross-border

  • Yearly exports: $12.4 trillion, €11.05 trillion
  • 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%
  • Yearly imports: $12.29 trillion, €10.95 trillion
  • 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%
  • Debt – external: $56.9 trillion, €40 trillion