Pillar 10: Market size
What does it capture? The size of the domestic and foreign markets to which a country’s firms have access. It is proxied by the sum of the value of consumption, investment and exports.
Why does it matter? Larger markets lift productivity through economies of scale: the unit cost of production tends to decrease with the amount of output produced. Large markets also incentivize innovation. As ideas are non-rival, more potential users means greater potential returns on a new idea. Moreover, large markets create positive externalities as accumulation of human capital and transmission of knowledge increase the returns to scale embedded in the creation of technology or knowledge.
10.01 Gross domestic product
Gross domestic product (GDP) valued at purchasing power parity in billions of international dollars (constant 2011 prices). | 2017
Source: International Monetary Fund (IMF).
10.02 Imports of goods and services
Imports of goods and services, expressed as a percentage of GDP. | 2017
This indicator illustrates the value of all goods and other market services received from the rest of the world, as a percentage of the country’s GDP. Imports include the value of merchandise, freight, insurance, transport, travel, royalties, license fees and other services, such as communication, construction, financial, information, business, personal, and government services. They exclude compensation of employees and investment income (formerly called factor services) and transfer payments.
Sources: World Trade Organization (WTO); International Monetary Fund (IMF).