Spain is back! That is, according to The Economist, who crowned it the ‘rich’ world’s best economy in 2024, thanks to its rapid economic growth, low inflation, plummeting unemployment and amazing stock market performance. However, while many media outlets agreed, Spaniards … seem to disagree wholeheartedly, with over 63% of Spaniards classifying their economy as bad or very bad in late 2024.

So, what is going on? How can Spain’s economy simultaneously have amazing growth numbers, while the people hate it?

To find out, I had to do a lot of research. This time though, I’ll walk you through exactly how I went about it

So, okay. This is my research station. To research a complex question like this, my approach is to first to break it into smaller parts.

That is, if there is a big difference between two economic narratives, then it makes sense to first fact-check them individually. You can do this in any order, but given that The Economist ranking motivated me to make this video, I think it makes sense to start with

Narrative 1: Spain was the best economy of 2024.

Now, at this point, I had already read the article a couple of times. But, reading something a couple of times does NOT lead to a THOROUGH understanding. Therefore, when considering something as a main source, I tend to come up with one or multiple question that may help me read the article in a more focused way.

In this case, I had three questions.

  1. What data did The Economist use to crown Spain Europe’s top performing economy?
  2. Question 2: Why did they use this data? And finally,
  3. Question 3: did they use the CORRECT data?

Question 1 was easy to answer because I could just find it in the article. The Economist looked at 5 different factors to make it’s ranking: (1) GDP change in the fourth quarter of 2024, (2) increase in share prices over a year, (3) change in consumer prices over a year, (4) change in unemployment in the last quarter of 2024, and finally (5) the change in government spending, compared to what it is getting in taxes.

Next, I went through each of these 5 factors to answer questions two and three. Why was this data used? It was not easy to answer because The Economist had not always written down why they used a certain variables for their ranking. Did they use the correct data? That was even tricker, because anyone making a ranking of course believes they used the right data. So, to evaluate if they indeed did that, I had to lean heavily on my experience as a researcher.

So, is The Economist ranking wrong?

Let’s go through each of these 5 variables 1 by 1.

Variable 1: real GDP growth. The Economist writes that they chose this measure because it is

“ widely regarded as the most reliable measure of an economy’s overall health”

I agree. GDP measures the total income in the economy. But, because price increases raise GDP, while not making the citizens of a nation feel happier, you need to correct for inflation.

However, this is where my first alarm bell started going off… that is, what I tend to look at first is real GDP PER PERSON. Not TOTAL GDP. And actually, the Economist admits this when it writes that

<In Spain annual GDP growth is on track to exceed 3%, driven by a strong labor market and high levels of immigration, which mechanically lift economic output. Although the country’s GDP per person has also risen, it has done so by less than overall GDP.

This COULD explain why Spain’s economy looks good on paper, but feels bad to the people in it. In 2024, Spain’s received a record number of migrants, especially from Latin America. More people means a bigger economy. Simple as that. But, that does NOT necessarily translate to people feeling good about the economy, see for example Canada, where people tend to feel like they are in a recession while the economy is still growing. But, if you look at GDP per person, you will that Canada is actually in a recession.

However, that was not the case in Spain, even when corrected for migration, it’s economy was still growing quite a bit.

So, on to variable number 2: stock market price growth, again corrected for inflation. The Economist does not explain in this article why they think stock market prices say something about an economy. But, based on my experience, I suspected that it had to do with the fact that stock market prices today are determined by the profits that firms make in the future. So, if the stock market is optimistic about the future, this is a GREAT SIGN that economic growth is expected to remain positive in the future.

Which is great. But, it didn’t help explain Spanish negativity.

Which brought me to year over year core inflation prices. At first, I thought it was a bit strange that The Economist included inflation again, given that it was already accounted for in their GDP and stock price calculations. They also did NOT go into detail why it was included. But, they did write that core inflation strips out volatile energy and food prices. This led me to infer that they included this factor to make sure that, if a country just has a bad year based on energy prices, it loses out less in the ranking than countries with a structural inflation problem.

Which made sense to me. But, it didn’t help my answer my main question. So, on I went to the next indicator: change in unemployment.

I was happy to see this indicator being included because it somewhat deals with one of the biggest criticisms about GDP, which is that it does NOT take inequality into account.

For example, if your neighbor wins the lottery, your street’s GDP may look amazing that year, but with the exception of your lucky neighbor, nobody in the street actually experienced that GDP boom. In fact, they may feel poorer simply because their neighbor got rich, while they did not.

Changes in unemployment, take this somewhat into account. After all, if more people get a job, then this tends to make a country more equal. However, unemployment is not a perfect measure of inequality. So, at this point I decided to do a bit of extra research to find out if rising or excessive inequality could explain why Spaniards are so negative about their economy.

To find out, I mainly looked at the Gini-coefficient for Spanish incomes, which is the most common metric economists use to measure average inequality. Sadly, though, the last data was for 2020. But, this showed inequality was moving in right direction and was at a level not so much crazier than other countries. So, while, inequality could explain Spanish misery, it didn’t raise a huge red flag.

So, I had to move on to the final variable the Economist used: the change in the government’s primary balance, which means the change in government spending versus what they get in taxes. Here, The Economist writes that this factor was included because rapid economic growth may not be sustainable if it is fueled by increased government debt.

Which…. I think is reasonable, but, in my opinion, incomplete for two reasons.

First, excessive government spending is only dangerous is government debt is already really high. Second, economic growth can also be unsustainable if it is powered by a lot of private borrowing. Take for example economic growth in the Spain in 2007. It was clearly not sustainable. But, government debt was actually really low and going down.

So, to judge the state of any economy, I always look at BOTH government debt and private debt sustainability.

However, in Spain, these both looked pretty reasonable, at least compared to other countries.

So, essentially, up to this point, my research efforts were not good enough yet. I did find that Spain’s economic growth was partially powered by an immigration boom. But, this effect was not big enough to explain why Spanish people hated their economy so much.

So, I had to move on to

Narrative number 2: Spanish people hate their economy

which is based on this 2024 survey from Statista, which finds that almost 42% of Spaniards thought their economy was bad. 22% thought it was very bad. 26% of people thought it was good and only 2.5% of people thought it was very good.

Can we trust this survey though? I essentially had 2 concerns about that I wanted to look into first.

The first was: well, maybe people are just critical in general. Perhaps, it is normal for people to think that ‘great’ economies are NOT GREAT because they always want it to improve. Second, I figured, when asking people’s opinions, culture matters. So, it could also be that Spanish people are just culturally inclined to be negative the economy.

So, here’s what I found. First, I had a look at similar surveys done in countries that have a reputation for having a better economy, like for example, the country where I was born: The Netherlands. As you can see here, question 1 is wrong. People can be positive about their economy. After all, according to this poll in 2025, most Dutch people thought their economy was pretty good. But, strangely enough, the Dutch economy did not make it into the top 10 of the The Economist Ranking of 2024.

So, could it be that perhaps, there’s something about Spanish culture. Were Spaniards always this negative about their economy? …. well. I don’t think so. You see, I found this poll from Pew research which clearly shows that before the massive crash of 2008, most Spaniards were actually pretty positive about their economy.

So, then, what’s deal the deal? Why are Spaniards now so negative, while their economy is doing great?

Well, actually, looking at this graph, something clicked in my mind. Ever since 2013, there is a clear trend that Spaniards are getting less negative about their economy. And, as we’ve seen, The Economist country ranking focusses on year-over-year improvements. So, this got me thinking:

Could it be that The Economist ranking is technically correct, but .. just not appropriate?

That is, could it be that people mostly care about the overall state of the economy, rather than just the improvement last year? To answer that question, I had a look at some of the same macroeconomic datapoints as before, but then, rather than looking at last year’s change, I took a long-term perspective instead.

So, we don’t care about GDP growth, we care about GDP per person. If we do that, and compare, for example, the Netherlands versus Spain, we can see that now the surveys are starting to make sense. The average Spaniard was always poorer than the average Dutchman. But, his situation stagnated much more than that of the average Dutchman after 2008.

Similarly, while unemployment was always higher in Spain, it has not yet returned to it’s 2008 low, while in the Netherlands it has.

Similarly, while’s Spain’s stock market may have done well in 2024, it is still quite a bit smaller than that of it’s tiny northern neighbor. And, while inflation and private debt are lower in the Netherlands, government debt is quite a bit higher.

So, overall, while the Dutch economy is not better in every way, I do think that long-term economic statistics can explain really well why Spanish people hate their economy so much, while the Dutch don’t. While Spain’s economy may have grown quite fast last year —which is great news— it is, in my opinion still quite a stretch to call it the best economy of 2024.

If I can use a sports analogue, it would be a bit like calling Dutch football club Feyenoord the best club of 2024 because it improved it’s position by quite a lot more than Spain’s Real Madrid, a club that is clearly much much better.

This is why sports rankings are based on total strength, rather than on change in strength of last year, and with this video, I hope to have convinced you that this is how economic rankings should be done as well. I also hope to have shown you how badly Spain’s economy has been damaged by the great financial crisis and that, yeah, it is slowly moving in the right direction. But, we should not forget that Spain still has a long way to go before crowning it the best economy of 2024. Finally, I hope to have given you a little peak into my research process, where I always try to start with some data, and then work my way through as many sources as needed until coming to a reasonable position.

However, then, the question becomes which sources should you use and where can you find them. That question is not so easy to answer because it is different for each case study, and I heavily rely on my experience knowing which sources to use and which not.

That being said, the best source to start with is, in my opinion, subscribing to the sponsor of this video: The Economist.

That’s right, even though this video included a plea for them to change their country ranking, they still agreed to sponsor it, AND, more importantly despite criticizing that ranking, I still recommend that anyone who wants to truly get a better understanding about what is going on in the global economy, gets a subscription to The Economist, especially, given that an annual subscription is now 20% off via my link economist.com/moneymacro.

There are two reasons why I think an Economist subscription is essential for anyone who wants to know more about the global economy. First, The Economist is a specialized publication with a long history. Therefore, they have journalists all over the world that are monitoring the global economy on a daily basis. Second, as this video sponsorship has shown, The Economist takes positions based on their research, but is not married to these positions. Therefore, it frequently features letters, columns, and articles that present arguments different to their own.

So, if you truly want to understand what is going on in the global economy, do subscribe to the Economist, now at a 20% discount at economist.com/moneymacro or using the link in the description or top comment below.