Luxembourg has the highest per capita income, according to both nominal GDP and PPP GDP rankings. Different groups offer different rankings, but Luxembourg consistently comes out on top, with the United States ranking far behind in both assessments.
There are two main ways in which one can determine which country has the highest per capita income. You can look at Gross Domestic Product (GDP) at its Purchasing Power Parity (PPP), or you can look at what is called its nominal GDP. While different assessments and methods come to different conclusions for each position below the summit, it is mostly undisputed that the country with the highest per capita income, in any case, is Luxembourg.
We’ll first look at nominal GDP for the major countries, to see how Luxembourg compares to the competition in per capita income. Nominal GDP is determined by simply taking the value of all services and goods occurring in a given year and dividing it by the number of people living in the country. There is no attempt to compensate for the fact that a certain amount of money could buy more in one country than in another, so these numbers are not a good indicator of what per capita GDP is worth locally.
In terms of nominal GDP, Luxembourg comes out with the highest per capita income at around $88,000 US Dollars (USD). Country number two, Norway, lags far behind, at around $72,300 USD. After Norway is Qatar with around $62,900 USD. The United States ranks eighth, with just about $44,200 USD, just over half of Luxembourg’s per capita income, measured in nominal GDP.
PPP GDP is a considerably more useful indicator of wealth, but it’s open to more estimates, and so rankings differ based on who prepares them. Purchasing power parity is based on the idea that in a healthy global economy, any good will cost roughly the same. This means that if prices appear to differ, it is because the value of the currency differs between the two countries. By looking at a few benchmarks, such as a loaf of bread or a Big Mac hamburger, economies can be normalized to each other, allowing for better comparison across nations. However, since any element can be chosen and since the way to measure the costs of those elements can be different, various groups devise different scales of PPP.
There are three main groups offering good numbers on who has the highest PPP GDP per capita income: the CIA, the University of Pennsylvania, and the International Monetary Fund (IMF). In all three of these studies, Luxembourg appears to have the highest per capita income, although the exact number differs between them. Different groups may also choose to include or not include dependencies and territories, such as Bermuda, as independent of their respective nations.
The CIA ranks Luxembourg first at around $71,400 USD, followed by the territory of Bermuda at $69,900 USD. Next comes the Jersey dependency at $57,000 USD. The second-ranked nation, however, is Equatorial Guinea at $50,200 USD. Third is the UAE, at $49,700 USD. And rather than second, as in nominal GDP, Norway is fourth in this assessment, at $46,300 USD. The United States ranks sixth, with a PPP GDP of $43,800, far more than half of Luxembourg’s PPP GDP.
The University of Pennsylvania also ranks Luxembourg first in PPP GDP, with approximately $54,300 USD. The United States follows, at $39,500 USD. Norway is the third-highest nation, at $37,400 USD, and the UAE is close behind, at $33,400 USD. In this assessment, Equatorial Guinea comes in 60th, rather than second, with a PPP GDP of $10,300 USD.
Finally, data from the IMF, which looks only at IMF members, and Hong Kong, places Luxembourg in first place with a per capita income of $81,500 USD. Ireland comes in second with a PPP GDP of $44.676 USD, just ahead of Norway at $44.648 USD. The United States is in fourth place, at $43,200 USD, and Equatorial Guinea is again far from the top of the list at 43rd, with a PPP GDP of $18,200 USD.
As is clear, the rankings are far from perfect and, depending on the group and how they are evaluated, some countries go up or down by many ranks. However, even with these disparities, Luxembourg is clearly the nation with the highest per capita income, by any measure, and by an incredibly large margin.
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