The data included in the report represents the best available values from various sources at the time the report was prepared. Some data may have been revised or updated by the sources after publication. The following notes provide descriptions and sources for all the indicators listed in the Country Profiles.

The authors of this report developed estimates for missing values where country or economy data was not available for an indicator to calculate the Readiness for the Future of Production assessment. Most scores have been imputed by using an income-regional group approach. This means a score was estimated by taking the average score of the group of countries in both the same region and the same income level (See Appendix A for classifications). Table C1 at the end of this appendix reports the values by indicator and country or economy that corresponds to the imputed score, and the method used for the imputation. Note that in the ranking tables available online at http://wef.ch/fopreadiness18 imputed values are not reported.

Indicators and Data Sources

1.01 Economic complexity

A measure of the knowledge in a society as expressed in the products it makes. The economic complexity of a country is calculated based on the diversity of exports a country produces and their ubiquity, or the number of the countries able to produce them. Countries that are able to sustain a diverse range of productive know-how, including sophisticated, unique know-how, are able to produce a wide diversity of goods, including complex products that few other countries can make.
Additional details available here: http://atlas.cid.harvard.edu.
Unit of measure: (2.5)–2.5 (best)
Source: Harvard University, The Atlas of Economic Complexity, 2016

1.02 Manufacturing value added in economy

Manufacturing value added (MVA) as a % of Gross Domestic Product (GDP). MVA of an economy is the total estimate of net-output of all resident manufacturing activity units obtained by adding up outputs and subtracting intermediate inputs. The boundary of manufacturing as an economic activity refers to industries belonging to International Standard Industrial Classification (ISIC) divisions 15-37.
Unit of measure: % GDP
Source: United Nations Industrial Development Organization (UNIDO), 2016

1.03 Manufacturing value added

Manufacturing value added (MVA) as a logarithm with base of 10. MVA of an economy is the total estimate of net output of all resident manufacturing activity units obtained by adding up outputs and subtracting intermediate inputs. The boundary of manufacturing as an economic activity refers to industries belonging to International Standard Industrial Classification (ISIC) divisions 15-37.
Unit of measure: US$, logarithm base 10
Source: World Economic Forum calculation based on United Nations Industrial Development Organization (UNIDO) data, 2016

2.01 Mobile-cellular telephone subscriptions

Number of mobile-cellular telephone subscriptions per 100 people. This includes postpaid subscriptions, active prepaid accounts (i.e. that have been active during the past three months) and all mobile-cellular subscriptions that offer voice communications.
Unit of measure: Number per 100 people
Source: International Telecommunication Union (ITU), 2016

2.02 LTE mobile network coverage

Percentage of the population covered by at least an LTE/WiMAX mobile network. Refers to the percentage of inhabitants that live within range of LTE/LTE-Advanced, mobile WiMAX/WirelessMAN or other more advanced mobile-cellular networks, irrespective of whether or not they are subscribers. This is calculated by dividing the number of inhabitants that are covered by the previously mentioned mobile-cellular technologies by the total population and multiplying by 100. It excludes people covered only by HSPA, UMTS, EVDO and previous 3G technologies, and also excludes fixed WiMAX coverage.
Unit of measure: % population
Source: International Telecommunication Union (ITU), 2016

2.03 Internet users

Percentage of individuals who used the internet from any location and for any purpose, irrespective of the device and network used, in the last three months.
Unit of measure: % population
Source: International Telecommunication Union (ITU), 2016

2.04 FDI and technology transfer

Executive Opinion Survey: “To what extent does foreign direct investment (FDI) bring new technology into your country? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.05 Firm-level technology absorption

Executive Opinion Survey: “In your country, to what extent do businesses adopt the latest technologies? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.06 ICT-enabled business models

Executive Opinion Survey: “In your country, to what extent do ICTs enable new business models? (1=not at all, 7=to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.07 Cybersecurity commitment

Score from the 2017 Global Cybersecurity Index, which measures cybersecurity commitment across five pillars:

• Legal: Measured based on the existence of legal institutions and frameworks dealing with cybersecurity and cybercrime.
• Technical: Measured based on the existence of technical institutions and frameworks dealing with cybersecurity.
• Organizational: Measured based on the existence of policy coordination institutions and strategies for cybersecurity development at the national level.
• Capacity Building: Measured based on the existence of research and development, education and training programs; certified professionals and public sector agencies fostering capacity building.
• Cooperation: Measured based on the existence of partnerships, cooperative frameworks and information sharing networks.

Additional details available here: https://www.itu.int/dms_pub/itu-d/opb/str/D-STR-GCI.01-2017-R1-PDF-E.pdf.
Unit of measure: 0–1 (best)
Source: International Telecommunication Union (ITU), Global Cybersecurity Index, 2017

2.08 State of cluster development

Executive Opinion Survey: “In your country, how widespread are well-developed and deep clusters (geographic concentrations of firms, suppliers, producers of related products and services, and specialized institutions in a particular field)? (1 = nonexistent, 7 = widespread in many fields)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.09 Company investment in emerging technology

Executive Opinion Survey: “In your country, to what extent do companies invest in emerging technologies (e.g. Internet of Things, advanced analytics and artificial intelligence, augmented virtual reality and wearables, advanced robotics, 3D printing)? (1=not at all, 7= to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2017

2.10 Government procurement of advanced technology

Executive Opinion Survey: “In your country, to what extent do government purchasing decisions foster innovation? (1=not at all, 7=to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.11 Companies embracing disruptive ideas

Executive Opinion Survey: “In your country, to what extent do companies embrace risky or disruptive business ideas? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.12 Multistakeholder collaboration

Average score of the three following Executive Opinion Survey questions: “In your country, to what extent do people collaborate and share ideas within a company? (1 = not at all, 7 = to a great extent)”; “In your country, to what extent do companies collaborate in sharing ideas and innovating? (1 = not at all, 7 = to a great extent)”; and “In your country, to what extent do business and universities collaborate on research and development (R&D)? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

2.13 R&D expenditures

Expenditure on research and development (R&D) as a percentage of gross domestic product (GDP). Expenditures for research and development are current and capital expenditures (both public and private) on creative work undertaken systematically to increase knowledge, including knowledge of humanity, culture, and society and the use of knowledge for new applications. R&D covers basic research, applied research and experimental development.
Unit of measure: % GDP
Source: World Bank, 2015

2.14 Scientific and technical publications

Number of scientific and technical journal articles published per billion PPP$ GDP. Article counts are from a set of journals covered by the Science Citation Index (SCI) and the Social Sciences Citation Index (SSCI). Articles are classified by year of publication and assigned to each country/economy on basis of the institutional address(es) listed in the article. Articles are counted on a count basis (rather than a fractional basis)—that is, for articles with collaborating institutions from multiple countries/economies, each country/economy receives credit on the basis of its participating institutions.
Unit of measure: Number per billion PPP$ GDP
Sources: Special tabulations from Thomson Reuters, Web of Science, Science Citation Index (SCI) and Social Sciences Citation Index (SSCI); International Monetary Fund, World Economic Outlook Database; data via World Intellectual Property Organization (WIPO), Global Innovation Index, 2016

2.15 Patent applications

Total number of patent families filed in at least two of the major five (IP5) patent offices in the world per million people. The major five (IP%) offices are: the European Patent Office (EPO), the Japan Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the State Intellectual Property Office of the People’s Republic of China (SIPO), and the United States Patent and Trademark Office (USPTO). Data is extracted from the PATSTAT database by earliest filing date and inventor country, using fractional counts. Presented in average number of applications over 2012-2014 and divided by the average population over the same period to get per million population.
Unit of measure: Number per million people
Source: World Economic Forum calculation based on Organisation for Economic Co-operation and Development (OECD) data (patents) and World Bank data (population), 2012–2014 moving average

2.16 Venture capital deal volume

Three-year average value of venture capital deals (US$). Deal status includes: Completed; Announced; In bidding process; Upcoming; Postponed. Deal date from: 1 January 2014 to 31 December 2016.
Unit of measure: US$ millions
Source: Pitchbook, 2014–2016 moving average

2.17 Venture capital deal volume per size of economy

Three-year average value of venture capital deals divided by the three-year average value of GDP (US$). Deal status includes: Completed; Announced; In bidding process; Upcoming; Postponed. Deal date from: 1 January 2014 to 31 December 2016. The data are reported per billion PPP$ GDP.
Unit of measure: US$/GDP (three-year average)
Sources: World Economic Forum calculation using Pitchbook data (VC deals) and World Bank data (GDP), 2014–2014–2016 moving average

3.01 Manufacturing employment

The share of manufacturing employment in total employment. Employment is defined as comprising all persons of working age who, during a specified brief period, were in the following categories: paid employment (whether at work or with a job but not at work) or self-employment (whether at work or with an enterprise but not at work). No distinction is made between persons employed full time and those working less than full time. The sectors of economic activity are defined according to the International Standard Industrial Classification of All Economic Activities (ISIC), Revision 3 (1990) and Revision 4 (2008). Manufacturing refers to industries belonging to the sector D defined by ISIC Revision 3, or C defined by ISIC Revision 4. Figures for updates are obtained from national data and estimates produced by the International Labour Organization (ILO).
Unit of measure: % working population
Sources: United Nations Industrial Development Organization (UNIDO), International Labour Organization (ILO), 2015

3.02 Knowledge-intensive employment

Sum of people in categories 1 to 3 as a percentage of total people employed, according to the International Standard Classification of Occupations (ISCO). Categories included are: ISCO-08: 1 Managers, 2 Professionals, and 3 Technicians and associate professionals (years 2007–15); ISCO-88: 1 Legislators, senior officials and managers, 2 Professionals, 3 Technicians and associate professionals (2007–15); ISCO-68: 1 Professional, technical and related workers (category 0 Armed forces is excluded), 2 Administrative and managerial workers, 3 Clerical and related workers (years 2007–08).
Unit of measure: % working population
Sources: International Labour Organization (ILO; data via World Intellectual Property Organization (WIPO), Global Innovation Index, 2015

3.03 Female participation in labour force

The ratio of the percentage of women aged 15–64 participating in the labour force as workers earning wages and salaries to the percentage of men aged 15–64 participating in the labour force as workers earning wages and salaries.
Unit of measure: Ratio
Source: World Economic Forum calculation based on International Labour Organization (ILO) data, 2016

3.04 Mean years of schooling

Average number of completed years of education of a country’s population aged 25 years and older.
Unit of measure: Years
Source: United Nations Educational, Scientific and Cultural Organization (UNESCO) Institute for Statistics, 2015

3.05 Availability of scientists and engineers

Executive Opinion Survey: “In your country, to what extent are scientists and engineers available? (1 = not available at all, 7 = widely available)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.06 Digital skills among population

Executive Opinion Survey: “In your country, to what extent does the active population possess sufficient digital skills (e.g. computer skills, basic coding, digital reading)? (1= not at all, 7= to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.07 Migration

The measure of net migration (inflows and outflows) in a country over the period from 2010–2015, in 000s of people (in thousands), per 2015 population size.
Unit of measure: Thousands of migrants/population
Sources: World Economic Forum calculation based on United Nations International Children’s Emergency Fund (UNICEF) data (Total net migration 2010–2015 in thousands) and United Nations Industrial Development Organization (UNIDO) data (population), 2010–2015

3.08 Country capacity to attract and retain talent

Average score of the two following Executive Opinion Survey questions:
“To what extent does your country attract talented people from abroad? (1 = not at all; 7 = to a great extent, the country attracts the best and brightest from around the world)” and “To what extent does your country retain talented people? (1 = not at all, the best and brightest leave to pursue opportunities abroad; 7 = to a great extent, the best and brightest stay and pursue opportunities in the country)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.09 Quality of universities

The number of universities for each country included in QS World University Ranking 2018 out of 972 universities.
Unit of measure: Number
Source: Quacquarelli Symonds (QS), 2017

3.10 Quality of math and science education

Executive Opinion Survey: “In your country, how do you assess the quality of math and science education? (1 = extremely poor, among the worst in the world; 7 = excellent, among the best in the world)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.11 Quality of vocational training

Executive Opinion Survey: “In your country, how do you assess the quality of vocational training? (1 = extremely poor, among the worst in the world; 7 = excellent, among the best in the world)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.12 School life expectancy

Total number of years of schooling (primary to tertiary) that a child can expect to receive. Based on the assumption that the probability of his or her being enrolled in school at any particular future age is equal to the current enrollment ratio at that age.
Unit of measure: Years
Source: United Nations Educational, Scientific and Cultural Organization (UNESCO), 2015

3.13 Pupil-to-teacher ratio in primary education

Average number of pupils per teacher based on the headcounts of both pupils and teachers in a country.
Unit of measure: Ratio
Source: World Bank, 2015

3.14 Critical thinking in teaching

Executive Opinion Survey: “In your country, how do you assess the style of teaching? (1 = frontal, teacher based and focused on memorizing; 7 = encourages creative and critical individual thinking)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.15 Active labour policies

Executive Opinion Survey: “In your country, to what extent are unemployed people supported in reskilling and finding new employment? (1=not at all, 7=to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.16 On-the-job training

Average score of the two following Executive Opinion Survey questions: 1) “In your country, how available are high-quality, professional training services? (1 = not available at all, 7 = widely available)” and 2) “In your country, to what extent do companies invest in training and employee development? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

3.17 Hiring and firing practices

Executive Opinion Survey: “In your country, to what extent do regulations allow flexible hiring and firing of workers? (1 = not at all, 7 = to a great extent)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

4.01 Trade

The sum of exports and imports of goods and services measured as a share of GDP.
Unit of measure: % GDP
Source: World Bank, 2016

4.02 Trade tariffs

Trade-weighted average tariff rate. An applied tariff is a customs duty that is levied on imports of merchandise goods. This indicator is calculated as a weighted average of all the applied tariff rates, including preferential rates that a country applies to the rest of the world. The weights are the trade patterns of the importing country’s reference group.
Unit of measure: % duty
Source: International Trade Centre, Trade Competitiveness Map Data, 2016

4.03 Prevalence of trade barriers

Executive Opinion Survey: “In your country, to what extent do non-tariff barriers (e.g. health and product standards, technical and labeling requirements, etc.) limit the ability of imported goods to compete in the domestic market? (1 = strongly limit, 7 = do not limit at all)”
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

4.04 Logistics performance

Average score of five components from the International Logistics Performance Index:

• Customs: the efficiency of customs and border management clearance
• Ease of arranging shipments: the ease of arranging competitively priced shipments
• Quality of logistics services: the competence and quality of logistics services—trucking, forwarding and customs brokerage
• Tracking and tracing: the ability to track and trace consignments
• Timeliness: the frequency with which shipments reach consignees within scheduled or expected delivery times

Unit of measure: 1–5 (best)
Source: World Economic Forum calculation based on World Bank data, International Logistics Performance Index, 2016

4.05 Greenfield investments

Five-year average value of announced greenfield FDI projects, by destination, in US$ (millions). A greenfield investment is a form of foreign direct investment where a parent company builds its operations in a foreign country from the ground up, organically.
Unit of measure: US$ millions
Source: United Nations Conference on Trade and Development (UNCTAD), 2012–16 moving average

4.06 FDI inflows

Five-year average net FDI flows of country or economy. FDI inflows and outflows comprise capital provided (either directly or through other related enterprises) by a foreign direct investor to a FDI enterprise, or capital received by a foreign direct investor from a FDI enterprise. Data on FDI flows are presented on net bases (capital transactions’ credits less debits between direct investors and their foreign affiliates).
Unit of measure: US$ millions
Source: United Nations Conference on Trade and Development (UNCTAD), 2012–16 moving average

4.07 Domestic credit to private sector

Financial resources provided to the private sector by financial corporations as a percentage of GDP. Financial resources are loans, purchases of non-equity securities, and trade credits and other accounts receivable, that establish a claim for repayment.
Unit of measure: % GDP
Source: World Bank, Bank for International Settlements, 2016

4.08 Transport Infrastructure

This indicator is calculated by the World Economic Forum by aggregating eight indicators that measure roads, railroads, air transport and water transport infrastructure. For more information, write to [email protected]
Unit of measure: 0–100 (best)
Source: World Economic Forum, 2017

4.09 Electricity Infrastructure

This indicator is calculated by the World Economic Forum by aggregating two indicators that measure the electrification rate and electric power transmission and distribution losses. For more information, write to [email protected]
Unit of measure: 0–100 (best)
Source: World Economic Forum, 2017

5.01 Regulatory efficiency

Average of score of three components from the Index of Economic Freedom:

• Business Freedom: the extent to which the regulatory and infrastructure environments constrain the efficient operation of businesses.
• Labour Freedom: considers various aspects of the legal and regulatory framework of a country’s labour market, including regulations concerning minimum wages, laws inhibiting layoffs, severance requirements, and measurable regulatory restraints on hiring and hours worked, plus the labour force participation rate as an indicative measure of employment opportunities in the labour market.
• Monetary Freedom: combines a measure of price stability with an assessment of price controls.

Unit of measure: 0–100 (best)
Source: World Economic Forum calculation based on The Heritage Foundation data, Index of Economic Freedom, 2017

5.02 Corruption Perceptions Index

Overall score from the Corruption Perceptions Index (CPI). The CPI scores/ranks countries/territories based on their perceived level of corruption in the country’s public sector. It is a composite index: a combination of surveys and assessments of corruption, collected by a variety of reputable institutions.

Unit of measure: 0–100 (best)

Source: Transparency International, Corruption Perception Index, 2016

5.03 Future orientation of government

Average score of the following four Executive Opinion Survey questions:
1) “In your country, how fast is the legal framework of your country in adapting to digital business models (e.g. e-commerce, sharing economy, fintech, etc.)? (1 = not fast at all, 7 = very fast)”; 2) “In your country, to what extent does the government ensure a stable policy environment for doing business?”; 3) “In your country, to what extent does the government respond effectively to change (e.g. technological changes, societal and demographic trends, security and economic challenges)?”; 4) “In your country, to what extent does the government have a long-term vision in place?” For the last three questions, the answer ranges from 1 (not at all) to 7 (to a great extent).
Unit of measure: 1–7 (best)
Source: World Economic Forum, Executive Opinion Survey, 2017

5.04 Rule of Law

Score for the Rule of Law dimension in the Worldwide Governance Indicators report issued by the World Bank. Rule of law captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police and the courts, as well as the likelihood of crime and violence.
For more information on the concepts measured, visit http://info.worldbank.org/governance/wgi/#doc.
Unit of measure: (2.5)–2.0 (best)
Source: World Bank, Worldwide Governance Indicators, 2016

6.01 Alternative and nuclear energy use

Alternative energy includes hydropower and nuclear, geothermal, biomass and solar power, among others. Calculated as a % based on Total Primary Energy Supply.
Unit of measure: % total energy use
Source: International Energy Agency, 2014

6.02 CO² intensity level

Total CO² (carbon dioxide) emissions in a given country, as a ratio of GDP (US$ billions).
Unit of measure: CO² emissions in megatons/GDP (US$ billions)
Source: World Economic Forum calculation based on World Resources Institute data (Total CO²) and World Bank data (GDP), 2014

6.03 CH⁴ intensity level

Total CH⁴ (methane) emissions in a given country, as a ratio of GDP (US$ billions).
Unit of measure: CH⁴ emissions in megatons/GDP (US$ billions)
Source: World Economic Forum calculation based on World Resources Institute data (Total CH⁴) and World Bank data (GDP), 2014

6.04 N²O intensity level

Total N²O (nitrous oxide) emissions in a given country, as a ratio of GDP (US$ billions).
Unit of measure: N²O emissions in megatons/GDP (US$ billions)
Source: World Economic Forum calculation based on World Resources Institute data (Total N²O) and World Bank data (GDP), 2014

6.05 Baseline Water Stress

Score for Baseline Water Stress from the World Resources Institute report. Baseline water stress measures total annual water withdrawals (municipal, industrial and agricultural) expressed as a percentage of the total annual available blue water. Higher values indicate more competition among users. Countries were sorted into 5 respective categories based on their respective scores, low <10% (score from 0–1), low to medium 10-20% (score from 1–2), medium to high (score from 2–3), high 40–80% (score from 3–4), and extremely high >80% (4–5).
For more information, visit http://www.wri.org/sites/default/files/aqueduct_coutnry_rankings_010914.pdf.
Unit of measure: 0–5 (worst)
Source: World Resources Institute, 2013

6.06 Wastewater treatment

Score for Wastewater Treatment from the Yale EPI. The indicator measures the proportion of wastewater collected and produced by households, municipalities, and industry that is treated, weighted by the population covered by the sewage network.
Unit of measure: 0–100 (worst)
Source: Yale University, Environmental Performance Index, 2016

7.01 Market size

This indicator is calculated by the World Economic Forum as an aggregate measure that reflects Gross Domestic Product (GDP) valued at purchasing power parity in billions of international dollars and the imports of goods and services as a percentage of GDP. The score corresponds to the natural logarithm of the sum of GDP and imports, valued at purchasing power parity (PPP). Valuation of imports at PPP is estimated by multiplying the share of exports by the value of GDP. For more information, write to [email protected]
Unit of measure: 0–100 (worst)
Source: World Economic Forum, 2017

7.02 Buyer sophistication

Executive Opinion Survey: “In your country, on what basis do buyers make purchasing decisions? (1 = based solely on the lowest price, 7 = based on sophisticated performance attributes)”
Unit of measure: 1–7 (worst)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

7.03 Extent of market dominance

Executive Opinion Survey: “In your country, how do you characterize corporate activity? (1 = dominated by a few business groups, 7 = spread among many firms)”
Unit of measure: 1–7 (worst)
Source: World Economic Forum, Executive Opinion Survey, 2016–17 weighted average

Table C1: Imputation Methods and Imputed Values