Per Capita GDP Predictor

In a recent discussion about China and India, I shot off something about being able to approximate GDP per capita in countries by their free market rules and average citizenry IQ. The usual half-cocked blathering. I was challenged to provide evidence. The f-ing nerve! But it actually worked out.

In fact, it reflected remarkably accurate results. Accuracy increased even more by tweaking it a bit, adding membership in EU or NAFTA and oil production.

The result: Using just the two major factors -- Economic Freedom and average citizenry IQ -- plus slight tweaks from trading block membership and oil, the predicted GDP per capita for every country registered a shockingly high .97 correlation (r) with actual GDP per capita.

To be clear, this is about as scientific as the Duke boys running the General Lee over Schrodinger's cat to escape over the quantum state line. But interesting, nonetheless.

The following chart shows the actual and projected per capita GDPs (I left on the labels for a few countries):


So how was it done? The following describes the basic process:



This excel file contains all of the data.

The four-step process is described in more detail below.

PROCESS

Before anyone goes AlSharptonic rhyming scheme on my ass re "IQ", lets forget the nature vs. nurture debate. Let the Bell Curve authors duel Jesse Jackson over that. To help stem inflammation caused by implications of its mention, lets just refer to it perhaps more accurately, as "testing." Accordingly, this just examines the relationships of populations engaging in simple such testing and economic production. It should also be noted that several extremely poor nations over the last five decades had citizens that scored very highly (e.g., Vietnam averages 96, Belarus 96, Mongolia 98, Ukraine 96, Moldova 95, Russia 96, China 100, North Korea 105). Such testing is not just a test of how rich a country is. Some interesting scholarship on significance has been done by Garett Jones and W. Joel Schneider.

The process first derives a "Base Power" from average citizenry testing and Economic Freedom. This Base Power figure accounted for most of the predictive power of the projections. Base Power alone has a .87 correlation with actual GDP. Regarding its components, EF by itself registers a .79 correlation, while average citizenry testing alone was a .69.

Using average citizenry testing as a proxy for domestic economic productivity, I took simple country average testing scores from Richard Lynn. Hardly exact science, but we're going for broad brush correlations. I knocked out tiny countries (population less than 2.2 million) to dampen noise associated with tiny tourist meccas, tax havens, banking islands, tiny town-sized countries within others, etc.

Whether such testing reflects inherited traits or cultural norms is of no importance here in terms of projections. Even if its the latter, perhaps reflecting cultural emphasis on education, changing such ingrained emphasis would take decades, followed by decades of educational infrastructure changes and then decades for the student products of that infrastructure to age and fill out the entire working age populous (18-65 years old). So whether its nature, nurture or a mix, wholesale testing change of huge country-wide populations is likely numerous decades (or centuries) away, at best.

The following is a map of those testing figures (darker purple is higher):

Using those Lynn figures, I created a "Base Power", increasing or decreasing based upon the Fraser Institute's famous Economic Freedom Index. The Fraser Institute spearheaded a cooperative effort of international economic organizations to produce an index measuring the economic freedom of countries based upon a variety of factors. Economists debate about each of the individual factors utilized, but I'm going for a simple broad index here (e.g., Burma very low while economically free Switzerland was very high). This also does not merely test the wealth of countries. For example, poor countries such as Mauritius, Botswana, El Salvador and Jordan scored 7.0 or higher on the index -- considerably higher than rich western European mainstays Italy, France and Greece. A country doesn't have to be rich to deregulate and create a friendly economic environment (in fact, sometimes its politically harder for entrenched somewhat wealthy economies).

In addition, I didn't just use the latest (2003) Economic Freedom ("EF") numbers. Doing so would have ignored all prior restrictive policies, such as communist economic regulation. Instead, I averaged together (where available), 1990, 1995, 2000 and 2003 EFs. To give more impact to recent economic freedom, I weighted 2003 by an extra 50% and cut the weight of 1990 (where available) by 50%.

The following is a map of those Economic Freedom figures (darker red is higher):

Where a country's EF exceeded 7.1, I added the following to average citizenry testing to get Base Power: 7.5 x (EF - 7.1).

Where EF dipped below 7.0, but average testing was below 76, I did nothing -- Base Power simply equaled Avg testing. However, where EF was below 7.0 and Avg testing was above 75, I added the following for Base Power: (testing - 75) x (EF - 3)/4 + 75.

In very few instances, the Fraser Institute did not provide an EF score. Those instances almost always involved a hot war or strict authoritarian rule (worse than current communist Chinese or Vietnamese rule). When that occurred, I cut by 80% the amount of average testing in excess of 75 to arrive at a Base Power. If average citizenry testing was under 75 to begin with, I did nothing.

Note: For a tiny handful of instances where the Fraser Institute provided no EF, I substituted others EFs. For example, because Puerto Rico is a U.S. territory, the Fraser Institute provided no separate EF. So I used the United State's EF score. For Belarus, I used the Ukraine's figures, which were lower than nearby Poland and Lithuania, but higher than Russia's. The institute provided 2003 EF figures for Vietnam, but none for years before 2003, so I used figures from another index to produce 3.9 for 1990, 4.3 for 1995 and 5.0 for 2000. Similarly, Mozambique had 2003 figures, but no pre-2003 EF figures, so I just used its 2003 figure for all dates. The same was true for Georgia, so I substituted Russian numbers for 1990, 1995 and 2000.

The following is a map of the Base Power figures (darker green is higher):

Once Base Power ("BP") was established, I used it to begin to formulate a predicted per capita GDP ("PGDP").

Where Base Power dipped below 90, I assigned PGDP using the following: $1,000 + (BP - 60)^2.63

Where Base Power exceeded 90, the following formula was used to produce PGDP: $12,000 + (BP - 90) x $1,030

For countries in the huge land-connected contiguous European and North American trading blocks, I increased predicted per capita GDP to reflect the increased economic activity that comes along with trading, as well as additional business investment in country's companies located with access to those blocks.

I added $6,000 to PDGP for North American Free Trade Agreement ("NAFTA") countries United States, Canada , Mexico and Puerto Rico (member via U.S. territory).

I added $6,500 to PDGP for European Union ("EU") countries. I included a few longstanding western European non-EU members -- Switzerland, Norway, Iceland -- that could easily qualify for EU entry (near the top) and have long traded as if they were virtual EU members by changing regulations for such trading ease and because of their location. To that end, one primary reason those countries do not join the EU is that their location, regulations and corporate relationships already afford them most of the trading benefits of such membership. For example, Switzerland literally sits at the heart of Europe, between Germany, France, Italy and Austria, is a European international banking megacenter, and enjoys virtually all economic advantages from EU trading block activity, but is not officially a member.

For the brand new 2004 EU members, only $2,000 was added to PDGP.

The following is a map of the Trading Block countries (green for NAFTA, orange for EU block, yellow for new EU block):

I originally wanted to include all natural resource production, but didn't find an adequate source (at least in the short time I looked). Instead, I chose only oil, using the often-cited CIA World Factbook Oil Production figures.

Those figures provide barrels of oil produced by a country a day. I divided that number by the total number of citizens in each corresponding country, multiplied that by 365 (days in a year), then multiplied that figure by $63, which reflects a very gross estimate of total added domestic product (not just profit) to any economy per barrel.

Only an extremely small handfull of countries possessed in excess of $1,000 per capita GDP from this factor, but it was large for many of those few, such as Kuwait, Norway and the UAE.

The following is a map of Oil Production per capita figures (darker orange is higher):

COMMENTS

Surprising Accuracy & A Historical Look Back.

To test accuracy, I compared the Final PDGP to GDP per capita figures of the CIA World Factbook.

The following is a map of per capita GDP figures (darker green is higher) from the CIA factbook:

As mentioned, the statistical correlation (r) came in at a stunning .97 (.9669; .934 r2) with just two main variables (testing and EF) and two tweak bumps (trading block and oil).

The following is the chart of actual per capita GDP and that predicted by the simple process outlined above:


The median amount of difference between actual and predicted per capita GDP was only $1,826.

So I did some digging. As it turns out, all of this comports with historical increases over the last few decades of economically free high testing countries that were poor at the end of World War II, as well. In fact, Asia and Europe have been a virtual laboratory for this.

In short, it appears drastic global economic changes, including the easy spread of international business models, now permit countries with high average citizenry testing to achieve drastic per capita GDP boosts by maintaining relatively high economic freedom for a few decades.

For example, looking at 1960 historical GDP information in the Penn World Tables, the traditionally most productive economic powers possessed per capita GDPs of around $2,000 to $3,500, such as the United States (around $2,900), the U.K. ($2,200), Switzerland ($3,400), Canada ($2,400), Australia ($2,500), Denmark ($2,500), New Zealand ($2,700) and France ($1,900).

Meanwhile, in 1960, several high average testing countries that now have relatively free economies then had miniscule per capita GDPs, such as Hong Kong ($681), Taiwan ($315), Ireland ($1,100), Singapore ($482), Spain ($1,100) and Japan ($1,100). This is a quarter century after the end of World War II. Several decades later, while much of the world still remains in low per capita GDP territories, every one of those countries now enjoys a per capita GDP in excess of $20,000, placing them among the world's most productive economies. Here they are as a percentage of the U.K.s 1960 and 2005 GDP per capita:

Country	Avg Testing	1960 GDP/cap	% U.K. 1960	EF (15 yr weight)	Cur GDP/cap	%U.K. 2005
Taiwan	104	$315	14.3%	7.2	$26,700	86.4%
Hong Kong	107	$681	31.%	8.8	$36,800	119.1%
Ireland	93	$1,100	50.%	7.9	$34,100	110.4%
Singapore	100	$482	21.9%	8.6	$29,700	96.1%
Spain	99	$1,100	50.%	7.	$25,100	81.2%
Japan	105	$1,100	50.%	7.2	$30,400	98.4%
Korea, South	106	$337	15.3%	6.8	$20,300	65.7%

Demonstrating the economic freedom relationship, their communist counterparts with high average citizenry testing have not been so lucky. The contrast is stark. In 1960, ethnically similar (Han Chinese) Hong Kong and China were both under $700 GDP (a small fraction of the most productive economies). Then British leased Hong Kong kept economic freedom high, and its economy exploded upwards to the potential of its average citizenry testing, now existing as one of the world's most productive economies, with per capita GDP in excess of $35,000. Meanwhile, communist China's per capita GDP is still around $6,200 (the difference was even more stark before China's reforms started). Similarly, South Korea, which experienced a peninsula destroying war and the wrenching away of the northern half of its country in 1953, has brought its per capita GDP above $20,000, while ethnically identical communist North Korea has a per capita GDP of a paltry $1,800. Despite a sub-7.0 EF index, South Korea has increased closer to the potential of its 106 average testing citizenry. Where historical data existed, here are some comparisons versus 1960 and 2005 UK's per capita GDP to show -- despite very high average citizen testing -- the lack of growth where communism existed until relatively recently:

Country	Avg Testing	1960 GDP/cap	% U.K. 1960	EF (15 yr weight)	Cur GDP/cap	%U.K. 2005
Korea, North	106	$130	5.9%	--	$1,800	5.8%
China	100	$154	7.%	5.3	$6,200	20.1%
Russia	96	$510	23.2%	4.5	$10,700	34.6%
Vietnam	96	$93	4.2%	4.9	$3,000	9.7%

Of the potentially promising (from an average testing standpoint) former Eastern Bloc communist countries, East Germany (through unification), Hungary and the Czech Republic have started reforms most quickly, and all already enjoy per capita GDPs in excess of $15,000 (ditto for tiny former Yugoslavia ruled Slovenia). Most of the other former Eastern Bloc countries have been much more slow to reform.

At the same time, several potentially promising Asian countries are still mired in semi-communist (or related) rule. Vietnam (96), North Korea (106), Mongolia(98) and China(100) are the most notable examples. Other slightly less promising countries are in similar situations, such as Cambodia(89) and Laos(89).

Biggest Off-Spikes - High Scoring Ethnic Minority Multiplier?

Out of all 130 countries, only one, South Africa, had an actual per capita GDP that differed by more than $10,000 from predicted per capita GDP. In addition to South Africa, only Israel had a difference in excess of $7,000.

Interestingly, those two countries are often linked in political discussions. But that linkage consists of accusations by Israeli political opponents of South Africa-style "apartheid" treatment of Palestinians.

Consequently, interest is piqued when those two countries in particular spike highest above expected values, along with a high spike for the United States of around $5,700 over its predicted PDGP.


In that regard, all three of those countries are also famous for having noted ethnic mixes (sometimes cast in a favorable light, sometimes not) with some portion of that mix averaging on tests well in excess of the country's average. For example, Israel's testing average per Lynn is 94, which includes substantial Arab, African and South Asian populations that, in looking at figures elsewhere, do not score highly on such tests. Meanwhile, Israel's Ashkenazi Jewish minority famously averages highly on such tests, around 112-115. Likewise, ten percent of South Africa's population consists of largely the descendents of Dutch and British settlers who generally average considerably better (around 100) than the country's 72 average per Lynn. Similarly, the United States' is well known for being the destination point for vast numbers of the elite performers from every country and ethnicity worldwide for a variety of reasons, including its unrivaled university system, its entrepreneurial environment, its culture of mass immigration, as well as being the world's corporate epicenter. For example, sizeable numbers of the most successful (in business and academia) European, Asian and Ashkenazi Jewish populations from all over have settled in the United States for business, academic, political and cultural reasons.

Perhaps this is an arrow in multiculturalists' quivers. Maybe high scoring "minorities" in key top skill positions might, through some multiplier effect, add far more to actual GDP than their rather slight increase to the country's average testing would indicate. Consequently, perhaps such a "multicultural" mix leads to a higher average output overall than separating the two groups and aggregating their economic activity, through some kind of additional overall multiplier effectuated by the high performing group being paired with the lower performing overall average pop. Obviously, pure speculation, but a thought that I'm sure has been studied at length.

Similarly, Brazil registers another smaller spike, and it has a sizable population with European ancestry that likely clusters around a significantly higher 98-100 average than the country's overall 87 average.

Pacific Variances

Most of the larger spikes above predicted value besides the above three were Pacific economic powers. While all come in with both relative high predicted and actual GDP per capita, several scored below predicted values. For example, South Korea came in around $6,800 below predicted values, New Zealand $6,600 under and Hong Kong around $6,000 under. Meanwhile, Australia came in around $5,800 over predicted values.



Perhaps relative geographic isolation is a factor, though Australia and Japan appear to be flourishing under the same circumstances.

Interesting Future Prospects -- Former Communist Countries Reform

Applying the formulas herein, a gargantuan economic expansion could follow from worldwide reforms in former economically repressive countries. As a starting point, the following are countries with GDP's per capita under $15,000, but average citizen testing at 94 or above:

Country	Avg Testing	Curr EF	GDP/cap	GDP
Moldova	95	--	$2,100	$9,367,000,000
Mongolia	98	--	$2,200	$6,010,000,000
Vietnam	96	4.9	$3,000	$251,800,000,000
China	100	5.3	$6,200	$8,158,000,000,000
Ukraine	96	4.7	$6,800	$321,200,000,000
Belarus	96	4.7	$7,600	$77,770,000,000
Romania	94	4.7	$8,300	$186,400,000,000
Uruguay	96	6.3	$10,000	$32,920,000,000
Russia	96	4.5	$10,700	$1,535,000,000,000
Poland	99	5.4	$12,700	$489,300,000,000
Latvia	97	6.1	$12,800	$29,420,000,000
Argentina	96	6.2	$13,600	$537,200,000,000
Lithuania	97	6.0	$13,700	$49,380,000,000

As expected, most of those countries came in at low expected GDPs because of low Economic Freedom:


To illustrate the effect of their policies, if one takes Economic Freedom (EF) out of our projections, such that their repressive current and former economic policies aren't accounted for, these countries all sag very low below projected values (sidenote: correlation falls to .88):

Those countries were mostly former, or current, communist countries in various states of economic awakening.

Let's examine the projected economic change if those countries reformed Economic Freedom index numbers up to a weighted average 7.0:

Country	Avg Testing	Curr EF	GDP/cap	GDP	Proj EF	Proj GDP/cap	Proj GDP	Proj-Act GDP Diff
Moldova	95	--	$2,100	$9,367,000,000	7.	$17,150	$76,410,470,150	$67,043,470,150
Mongolia	98	--	$2,200	$6,010,000,000	7.	$20,244	$56,507,808,570	$50,497,808,570
Vietnam	96	4.9	$3,000	$251,800,000,000	7.	$18,290	$1,527,874,771,680	$1,276,074,771,680
China	100	5.3	$6,200	$8,158,000,000,000	7.	$22,362	$29,211,372,487,600	$21,053,372,487,600
Ukraine	96	4.7	$6,800	$321,200,000,000	7.	$18,222	$856,391,175,000	$535,191,175,000
Belarus	96	4.7	$7,600	$77,770,000,000	7.	$18,260	$188,090,600,940	$110,320,600,940
Romania	94	4.7	$8,300	$186,400,000,000	7.	$16,243	$362,695,634,240	$176,295,634,240
Uruguay	96	6.3	$10,000	$32,920,000,000	7.	$18,183	$62,111,428,425	$29,191,428,425
Russia	96	4.5	$10,700	$1,535,000,000,000	7.	$19,647	$2,817,785,467,620	$1,282,785,467,620
Poland	99	5.4	$12,700	$489,300,000,000	7.	$23,285	$897,808,355,030	$408,508,355,030
Latvia	97	6.1	$12,800	$29,420,000,000	7.	$21,210	$48,575,926,770	$19,155,926,770
Argentina	96	6.2	$13,600	$537,200,000,000	7.	$18,613	$735,931,078,740	$198,731,078,740
Lithuania	97	6.	$13,700	$49,380,000,000	7.	$21,289	$76,568,464,770	$27,188,464,770
Total								$25,234,356,669,535

The increase is staggering. Over 25 trillion dollars added to the world economy -- a 43% increase. Also, those are current 2005 dollars and populations, without taking into account the normal growth associated with technological and standard economic annual productivity increases.

The vast majority of that (83%) comes from China's incredible growth. It illustrates why economists are so excited about China's future even though it remains communist, and seemingly far less excited about non-communist India.

In short, China's slowly unleashing its whopping 1.3 billion 100 average testing citizenry that have been held back by communist regulation. Its massive growth over the last few years is no accident, and its likely just going to ramp up. This reality reflects the basic rule illustrated by the relationships on this page -- with equal Economic Freedom ("EF") numbers, countries gravitate generally toward a production based on average citizenry testing. In addition, countries must wait several years before economic reforms fully bear fruit in terms of domestic product.

China registers slightly under its predicted per capita GDP, but the projection was roughly accurate. Even though its citizenry measured a 100 testing average, its projected per capita GDP was only around $8,500 because its average EF index for 15 years is a lowly 5.34, while its actual per capita GDP came in at $6,200. China's obviously a slowly emerging former communist power. However, its current (2003) EF index is already up to a 6.0.

Even if we just assumed that no more reforms occurred for the next 15 years, we'd still get just the next 15 years of 6.0 EF in China's economy. That projects to a Chinese per capita GDP of around $15,900 (those are real numbers, not nominal). But that's for 1.3 billion people. The added economic growth from this minimum expectation alone will be $12.6 trillion/year in GDP, in excess of the United States. That's monstrous for a global economy currently totaling only $59 trillion.

But, as demonstrated above, if we assume that China continues with deregulation and economic reforms, inching up in the high 7's on the EF Index (at the level of, say, the United Arab Emirates) such that its weighted EF average for the next 15 years is around a 7.0. China would then shoot up to a projected $22,362 per capita GDP, with an economic explosion of over $29 trillion total GDP per year -- well above that of the United States. This essentially would add over a third (36%) to the entire world's yearly economy from just this one country.

A Few Other Dips and Spikes

Only one country differs from projected GDP per capita by more than $7,000 (South Africa), most of the rest above $5,000 are discussed above. There are only a few others with actual-projected differences greater than $5,000, and many of these are very small countries barely over my 2.2 million population cutoff (e.g., Kuwait 2.3 million, Ireland 4 million, Croatia 4.4 million):

Country	Act GDP	Proj GDP	Act-Proj Diff	%Diff
United Kingdom	$30,900	$37,867	-$6,967	-18.4%
Croatia	$11,600	$5,079	$6,521	128.4%
Ireland	$34,100	$27,768	$6,332	22.8%
Kuwait	$22,100	$28,432	-$6,332	-22.3%
Chile	$11,300	$17,199	-$5,899	-34.3%
Portugal	$18,400	$23,658	-$5,258	-22.2%

Most of those economies possess large per capita GDPs, so while the end difference is large, its not particularly large as a percentage of the whole.

The contiguous U.K. and Ireland both differ by between $6,000-$7,000, but in opposite directions. An interesting result. Nearly the same is true for South Pacific neighbors New Zealand and Australia (Australia about $6K above while New Zealand nearly the same amount below).

A few of these possess relatively easy to explain possible variations.

For example, Ireland's testing figure could easily be too low. Its listed at 93, or the testing level of Kazakhstan ("In Kazakhstan we have many hobbies: disco dancing, archery, rape and table tennis."). This is well below the rest of Western Europe, and far below its contiguous British Isle neighbor (U.K. at 100).

Country	Testing
Netherlands	102
Germany	102
Austria	102
Italy	102
Switzerland	101
Sweden	101
Luxembourg	101
United Kingdom	100
Belgium	100
Spain	99
Norway	98
Denmark	98
Iceland	98
France	98
Finland	97
Portugal	95
Ireland	93
Greece	92

Celtic isolation from Roman, Anglo-Saxon and Norman invasions aside, one might guess this is lower than actual numbers. Another chart lists a more recent (but less widespread) average test of 98 in Ireland, which would be closer to Western Europe. In fact, were that assumed for Ireland's testing, its predicted and actual GDPs draw to within around $1,000 of each other.

Croatia possesses similarly easy potential explanations. Croatia broke off from Tito's formerly communist Yugoslavia. Many of those former Yugoslavian countries are too small for this page's analysis, but their per capita GDP's now vary extremely widely:

Country	Act GDP/Capita
Croatia	$11,600
Serbia & Montenegro	$2,600
Slovenia	$20,900
Macedonia	$7,400
Bosnia and Herzegovina	$6,800

A few possibilities exist here for Croatia's higher than projected performance. First, I think its 1990 and 1995 EF numbers might have been depressed by the war following Yugoslavia's breakup, thus decreasing its weighted average EF index and its projected GDP. Perhaps its current (2003) 6.0 EF Index number should be weighted much higher in its weighted average EF. In addition, both Croatia, and a tiny nearby mountain neighbor too small for our analysis (Slovenia), quickly began trading with very close by Western European countries like Italy and Austria, as well as contiguous Hungary. While Croatia is not in the EU, it is a candidate for the next round of membership, and its location and rail network access may have permitted it to leverage European trade and investment to boost economic performance much quicker than other much farther East reforming communist countries. In addition, its substantial Greek and Roman ruins, plus its long Adriatic coastline across from Italy, have already made it a hot spot for tourists seeking value (Rick Steves just ran a glowing Croatian episode on his European travel show).

All of these factors can have huge impacts on per capita GDP for a country of only 4.4 million.

Fairly simple explanations also exist for tiny Kuwait (barely over the 2.2 mil pop cut). Kuwait's difference could easily be related to Kuwait's incredibly odd labor structure and my oil production addition procedure. To begin with, Kuwait's a weird place -- only 45% of its people are Kuwaiti nationals. Kuwait's per capita oil production is so high that its government cuts Kuwaiti nationals huge oil checks and, consequently, many do not work. Accordingly, they've imported massive numbers of immigrant workers to perform large portions of the nation's labor needs (not just menial tasks). In fact, 80% of Kuwait's labor force is made up of non-nationals. To make a long story short, any per capita figures could likely skewer wildly in that environment. I tried to eliminate odd situations such as this with my 2.2 million population cutoff, but Kuwait scooted in just over it with a 2.3 million population, though only 1.1 million of those are Kuwaiti nationals. In addition, my procedures attribute 84% of this year's Kuwait projected GDP to oil production (oil prices were very high this year), so any issues related thereto will lead to huge projection differences. The following are all countries for which projected GDP capita from oil production exceeds $1,000 (many of these do not make our 2.2 mil pop cut):

Country	Population	Oil Prod/Capita	Proj GDP/Cap	% of Proj GDP	Act GDP
Kuwait	2,335,648	$23,806	$28,432	83.7%	$22,100
United Arab Emirates	2,563,212	$21,495	$27,967	76.9%	$29,100
Qatar	863,051	$21,062	$23,436	89.9%	$26,000
Equatorial Guinea	529,034	$18,256	$19,256	94.8%	$50,200
Norway	4,593,041	$16,121	$44,456	36.3%	$42,400
Saudi Arabia	26,417,599	$8,247	$10,865	75.9%	$12,900
Libya	5,765,563	$6,553	$9,222	71.1%	$8,400
Bahrain	688,345	$6,290	$11,179	56.3%	$20,500
Oman	3,001,583	$5,891	$10,734	54.9%	$13,400
Gabon	1,394,307	$4,435	$5,546	80.%	$5,800
Angola	11,827,315	$3,111	$4,434	70.2%	$2,500
Venezuela	25,375,281	$2,792	$6,815	41.%	$6,400
Canada	32,805,041	$2,152	$33,856	6.4%	$32,800
Kazakhstan	15,185,844	$1,969	$5,150	38.2%	$8,700
Iraq	26,074,906	$1,846	$4,677	39.5%	$3,400
Congo (Brazzaville)	3,602,269	$1,705	$3,556	48.%	$800
Denmark	5,432,335	$1,595	$31,397	5.1%	$33,500
Russia	143,420,309	$1,467	$6,333	23.2%	$10,700
Azerbaijan	7,911,974	$1,386	$4,217	32.9%	$4,600
Iran	68,017,860	$1,345	$4,866	27.6%	$8,100

The procedure used a simple $63/barrel addition. That could easily be off for Kuwait because of a particular oil deal leading to a theoretical decrease in the addition to the domestic economy below that of $63/barrel for this year. In fact, variances from that simple $63/barrel figure can be seen all over in smaller mostly oil economies, like Equatorial Guinea.

The final three -- Chile, Portugal and the UK -- do not possess the odd potential easily explanations for very small oddities like Croatia, Ireland and Kuwait.

Chile is an interesting case. Its performing excellently relative to other Latin American economies -- #2 behind Argentina for those observed.

Country	Testing	Weight EF	Act GDP/Cap	Proj GDP/Cap
Argentina	96	6.2	$13,600	$14,168
Chile	93	7.4	$11,300	$17,199
Uruguay	96	6.3	$10,000	$14,614
Mexico	87	6.2	$10,000	$12,309
Costa Rica	91	7.1	$10,000	$13,030
Brazil	87	5.1	$8,500	$4,326
Panama	84	7.1	$7,300	$5,265
Colombia	88	5.5	$7,100	$5,078
Dominican Republic	84	6.2	$6,500	$4,431
Venezuela	88	4.9	$6,400	$6,815
Peru	90	6.3	$6,000	$7,096
El Salvador	84	6.8	$5,100	$5,013
Paraguay	85	6.3	$4,900	$4,954
Guatemala	79	6.4	$4,300	$3,166
Jamaica	72	6.6	$4,300	$1,689
Ecuador	80	5.5	$3,900	$3,898
Cuba	85	--	$3,300	$2,868
Honduras	84	6.2	$2,900	$4,456
Nicaragua	84	5.6	$2,800	$4,038
Bolivia	85	6.4	$2,700	$5,126
Haiti	72	5.8	$1,600	$1,689

But it still registers about $5,900 below expected values for my projected per capita GDP calculations. One reason its projections are so high (over $17,000 -- the most for a Latin American country) is that it has very good Economic Freedom Index numbers, which had helped it with high growth for a decade (a screaming 8% in the 1990s). However, it was dragged down by very sluggish performance between 1999 and 2003, which coincided with a global slowdown (Chile is heavily reliant on foreign trade) and the election of a socialist government. Its growth is expected to rise considerably in 2005 and 2006, and likely beyond. In that regard, its positioning itself for a big economic explosion should the Free Trade of the Americas Agreement go into effect. Similarly, its already poised to take advantage of U.S. trade opening to it within 10 years based on an already executed U.S. bilateral FTA in 2004.

Portugal's recent economic output overall (not just my chart) has been difficult to analyze in many regards. Portugal had been reforming from its former relatively centralized economy, but its growth greatly slowed starting in 2001. Various explanations have been thrown around (severe education system criticisms). It possesses relatively low weighted average Economic Freedom numbers for Western Europe (7.1).

Country	Weight EF
United Kingdom	8.16
Switzerland	8.06
Ireland	7.9
Netherlands	7.76
Luxembourg	7.64
Finland	7.51
Denmark	7.5
Germany	7.49
Iceland	7.47
Austria	7.34
Belgium	7.33
Norway	7.31
Sweden	7.2
Portugal	7.05
Spain	7.04
France	6.88
Italy	6.65
Greece	6.54

Perhaps more likely is that its hitting somewhat troubling output ceilings on major portions of its economy such as textiles, clothing, footwear, cork and wood products, beverages (wine), porcelain and earthenware, and glass and glassware. It also elected a socialist government in early 2005. While its geographically far from Europe's center, so are Norway and Ireland, which are performing very well. To be honest, one might think it would get an additional boost being the only high GDP/capita country that shares the primary language with the massive Brazilian economy -- if not just in terms of economic trade, labor sharing and investment efficiencies -- but that doesn't appear to be boosting it above expectations.

Finally, there's the U.K. First, the U.K.'s former primarily English speaking colonies and territories almost all possess high EF numbers and perform very well, but most seem to either register GDPs well above or below expected values:

Country	Testing	Weight EF	Proj GDP/Cap	Act GDP/Cap	Diff	Diff%	Population
United Kingdom	100	8.16	$37,867	$30,900	-$6,967	-18.4%	60,441,457
United States	98	8.29	$36,039	$41,800	$5,761	16.%	295,734,134
New Zealand	100	8.17	$30,735	$24,100	-$6,635	-21.6%	4,035,461
Ireland	93	7.9	$27,768	$34,100	$6,332	22.8%	4,015,676
Australia	98	7.79	$26,215	$32,000	$5,785	22.1%	20,090,437
Hong Kong	107	8.81	$42,721	$36,800	-$5,921	-13.9%	6,898,686
Canada	97	7.94	$33,856	$32,800	-$1,056	-3.1%	32,805,041
South Africa	72	6.49	$1,801	$11,900	$10,099	560.6%	44,344,136

They've quite literally set the standard for economic excellence in nearly every area of the globe on which they exist. Somewhat interestingly, all of those English speaking former territories but New Zealand and South Africa now surpass the U.K. in per capita GDP, though most just slightly. With countries sharing a common language combined with the ease of modern movement, one wonders if brain drain doesn't start to go from a fringe activity to something that shows up in bottom line economic figures. For example, as the world's entrepreneurial, research, academic and corporate leader, the U.S. attracts top talent worldwide. But that likely increases from countries with very close ties and a common language, such as the U.K. and Canada. Not only have I seen this in droves in even the state-regulated legal world, but large participation by U.K. and Canadian talent can also be observed by everyone in industries as relationship-driven as the entertainment world, with top TV and movie stars leaving for U.S. shores in droves. Recently, U.S. networks even swiped whole top Britcoms The Office and Da Ali G Show. Down in the extremely isolated South Pacific -- almost its own world -- the same might occur from very small New Zealand to five times larger Australia. The effect of such brain drain might parallel that in the above discussion of possibly high testing minority populations potentially causing large GDP multiplier effects in places like the U.S., Israel and South Africa (well above their effects on average testing).

email:rpongett@pacbell.net