<p>To the best of my knowledge, there isn't. Ant that is actually a good thing, the economic structure of a country is usually a fairly complicated thing to be able to simplify it with a single number. You could, on the other hand, create an aggregate of measurements and try to look for patterns, e.g. you can see the behavior of macroeconomic variables such as <a href="https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita" rel="nofollow noreferrer">gdp</a>, <a href="https://en.wikipedia.org/wiki/List_of_countries_by_inflation_rate" rel="nofollow noreferrer">inflation rate</a> and <a href="https://en.wikipedia.org/wiki/List_of_countries_by_unemployment_rate" rel="nofollow noreferrer">unemployment</a>, and based on those decide which countries are similar to each other.</p>

<p>And that is why <a href="https://en.wikipedia.org/wiki/Cluster_analysis" rel="nofollow noreferrer">clustering analysis</a> is for. In the plot below I used Principal Component Analysis (just to reduce the dimensionality of the problem and be able to graphically display what's going on) to show 4 clusters fo countries. Each color is a <a href="https://en.wikipedia.org/wiki/K-means_clustering" rel="nofollow noreferrer">k-means</a> cluster, the axis are just the two firs principal components <span class="math-container">$x_1$</span> and <span class="math-container">$x_2$</span></p>

<p><a href="https://i.sstatic.net/LkTEL.png" rel="nofollow noreferrer"><img src="https://i.sstatic.net/LkTEL.png" alt="enter image description here"></a></p>

<p>I also added some of the countries on each cluster so you can see their similarity. For example, the <span class="math-container">$\color{blue}{\rm blue}$</span> cluster has large gdp, low unemployment, whereas countries in the <span class="math-container">$\color{green}{\rm green}$</span> cluster are not doing so well: high inflation, high unemployment and low gdp. </p>

<p>The cluster that you are interested in has these values (as of 2017)</p>

<pre><code>                 country     gdp  inflation  unemployment
---------------------------------------------------------
9              Australia   55692       1.95           5.3
13               Austria   47347       2.08           5.1
17               Belgium   43488       2.13           6.2
15                Canada   45094       1.60           5.6
8                Denmark   56630       1.15           4.8
14               Finland   45927       0.75           7.2
20                France   39932       1.03           8.9
16               Germany   44769       1.74           3.3
3                Iceland   70248       1.76           2.9
4                Ireland   68710       0.34           5.3
19                Israel   40272       0.24           3.7
22                 Japan   38448       0.47           2.4
0             Luxembourg  105863       1.73           5.0
11           Netherlands   48555       1.38           3.5
18           New Zealand   41572       1.85           3.9
2                 Norway   75389       1.88           4.0
5                  Qatar   61024       0.40           0.6
12            San Marino   47595       1.05           8.0
10                Sweden   52925       1.79           6.3
1            Switzerland   80637       0.53           2.4
23  United Arab Emirates   37732       1.97           1.6
21        United Kingdom   39800       2.69           4.0
6          United States   59792       2.13           3.9
</code></pre>

CC BY-SA 4.0
2019-01-19T08:30:30.900Z
2019-01-19T08:30:30.900Z
caverac
<p>Is there a measure of similarity for economies?</p>

<p>For example, I would like to find the world economies most similar to the UK.</p>

<international-economics>
Is there a measure of similarity for economies?
52d6c6af
# Is there a measure of similarity for economies?

(Asked by: username_0 on 2019-01-18)

Is there a measure of similarity for economies?

For example, I would like to find the world economies most similar to the UK.

**Tags:** international-economics


---

## 1 answers

### Answer by username_1 on 2019-01-19. Score: 3 | Accepted answer

To the best of my knowledge, there isn't. Ant that is actually a good thing, the economic structure of a country is usually a fairly complicated thing to be able to simplify it with a single number. You could, on the other hand, create an aggregate of measurements and try to look for patterns, e.g. you can see the behavior of macroeconomic variables such as [gdp](https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita), [inflation rate](https://en.wikipedia.org/wiki/List_of_countries_by_inflation_rate) and [unemployment](https://en.wikipedia.org/wiki/List_of_countries_by_unemployment_rate), and based on those decide which countries are similar to each other.

And that is why [clustering analysis](https://en.wikipedia.org/wiki/Cluster_analysis) is for. In the plot below I used Principal Component Analysis (just to reduce the dimensionality of the problem and be able to graphically display what's going on) to show 4 clusters fo countries. Each color is a [k-means](https://en.wikipedia.org/wiki/K-means_clustering) cluster, the axis are just the two firs principal components $x\_1$ and $x\_2$

[![enter image description here](https://i.sstatic.net/LkTEL.png)](https://i.sstatic.net/LkTEL.png)

I also added some of the countries on each cluster so you can see their similarity. For example, the $\color{blue}{\rm blue}$ cluster has large gdp, low unemployment, whereas countries in the $\color{green}{\rm green}$ cluster are not doing so well: high inflation, high unemployment and low gdp.

The cluster that you are interested in has these values (as of 2017)

```
                 country     gdp  inflation  unemployment
---------------------------------------------------------
9              Australia   55692       1.95           5.3
13               Austria   47347       2.08           5.1
17               Belgium   43488       2.13           6.2
15                Canada   45094       1.60           5.6
8                Denmark   56630       1.15           4.8
14               Finland   45927       0.75           7.2
20                France   39932       1.03           8.9
16               Germany   44769       1.74           3.3
3                Iceland   70248       1.76           2.9
4                Ireland   68710       0.34           5.3
19                Israel   40272       0.24           3.7
22                 Japan   38448       0.47           2.4
0             Luxembourg  105863       1.73           5.0
11           Netherlands   48555       1.38           3.5
18           New Zealand   41572       1.85           3.9
2                 Norway   75389       1.88           4.0
5                  Qatar   61024       0.40           0.6
12            San Marino   47595       1.05           8.0
10                Sweden   52925       1.79           6.3
1            Switzerland   80637       0.53           2.4
23  United Arab Emirates   37732       1.97           1.6
21        United Kingdom   39800       2.69           4.0
6          United States   59792       2.13           3.9

```


---

