Why Canada Took the Top Spot on This Year’s ‘Best Countries’ List

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Wharton’s David Reibstein talks with Wharton Business Daily on Sirius XM about the 2021 Best Countries Report.

Canada is the apparent envy of the world, earning the top spot on the U.S. News & World Report Best Countries rankings for 2021.

The nation has always scored well since the list began six years ago, but this is the first time that America’s neighbor to the north has hit the No. 1 position. Canada also placed high on several subrankings including quality of life, social purpose, agility, entrepreneurship, and an “open for business” climate. It’s perceived as having a good job market, no corruption, and a steadfast commitment to social justice and human rights.

“Generally, they are strong on just about every dimension, which is pretty amazing because most countries are strong on some and weak on some others,” Wharton marketing professor David Reibstein said in an interview with Wharton Business Daily on SiriusXM. (Listen to the podcast at the top of this page.) “There’s very, very little controversy that happens [in Canada], so it’s a country that people feel very positive about.”

Reibstein produces the rankings annually in partnership with U.S. News & World Report and BAV Group, a unit of global marketing communications company VMLY&R. The 2021 list measures perceptions about 78 nations chosen because they contribute most to the world’s GDP. More than 17,000 people around the world were asked to evaluate the countries based on 76 attributes ranging from political stability to racial equity to health consciousness. One-third of the survey respondents were business leaders; one-third were college-educated individuals who were middle class or higher; and one-third were from the general population.

“There’s very, very little controversy that happens [in Canada], so it’s a country that people feel very positive about.” –David Reibstein

The results of this year’s survey were undoubtedly shaped by the coronavirus pandemic, widespread civil unrest, and other factors that influenced perceptions of how each country is handling crisis.

“Nations are impacted on many critical fronts by how they are perceived globally — from foreign relations to international business to tourism. These perceptions are ever-evolving in a rapidly changing world,” said Kim Castro, editor and chief content officer at U.S. News. The analysis “combines data and storytelling to explore how countries compare on a host of global issues.”

The top 10 best countries are:

1. Canada

2. Japan

3. Germany

4. Switzerland

5. Australia

6. United States

7. New Zealand

8. United Kingdom

9. Sweden

10. Netherlands

The U.S. climbed one spot to No. 6 this year, but it has never held the top position. When the ranking premiered in 2016, America was fourth, and it slipped to No. 8 a year later. Reibstein believes the 2017 slide reflected the political landscape in the U.S. because the data was collected after the tumultuous 2016 election that put President Donald Trump in the White House.

“This year, we delayed the data collection until after the election once again, and what we saw is that the United States goes back up to No. 6,” he said.

America nabbed this year’s top score for agility, which helped boost its overall ranking. Agile countries as seen as modern, dynamic, progressive, adaptable, and responsive, according to the report.

“While we may not have handled the pandemic superbly, people have perceived us as being very good and very strong in our ability to be agile,” Reibstein said, noting that the U.S. also scored high in power and cultural influence.

“You don’t see wild swings because people have entrenched beliefs about particular countries.” –David Reibstein

Japan received a perfect score for entrepreneurship, which helped it clinch the No. 2 spot. Reibstein said it reflects Japan’s reputation for innovation. Germany once held the pole position for best overall country and for entrepreneurship, but the fallout from the Volkswagen scandal and struggles with immigration likely pushed it down the list a bit to No. 3, Reibstein said.

South Korea, Slovakia, and the U.K.

South Korea made the biggest leap on the list, jumping from No. 20 last year to No. 15 this year. Reibstein said that kind of movement is surprising: “You don’t see wild swings because people have entrenched beliefs about particular countries.”

He thinks the ranking was heavily influenced by how South Korea handled the COVID-19 pandemic — the country scored sixth on agility. It also made significant climbs on subrankings in entrepreneurship (from eighth to fifth) and quality of life (from 23rd to 18th).

“There’s sort of a halo effect,” Reibstein said. “They’re seen more as a mover than they were before. They’re seen to have more cultural influence, all the way from No. 20 in the world to No. 7. That may be K-pop, but I think it’s overall belief of a more positive attitude toward South Korea.”

While South Korea is basking in the glow, Slovakia is reeling from a hard fall. It went from No. 52 last year to No. 62 this year.

“The country that suffered the most, and I have no explanation for it, is Slovakia,” Reibstein said. “Don’t ask me to explain why that perception shifted.”

Reibstein also noted the “steady decline” of the United Kingdom, likely driven by Brexit and its handling of the pandemic. The U.K. was in the top three during the first few years of the ranking, dropped to No. 6 last year, and now is at No. 8.

“The fact that they even have a [COVID-19] variant that’s named after them, I’m sure doesn’t help at all,” he said.

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