With a combined $22 trillion in Gross Domestic Product (GDP) in 2011, the U.S. and China are the undisputed heavyweights of the global economy. These two nations generated more economic activity than the next eight largest economies — combined.

One year ago, we looked at the world’s top economies and noted that Brazil and China appeared poised to move up a few slots by 2040, as their economies grew at an above-average pace.

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But the size of the economy isn’t necessarily worthy of bragging rights. After all, China still has millions of people living in poverty. And here in the United States, we fare poorly when it comes to quality-of-life measures like infant mortality and life expectancy.

In the spirit of the London Olympics, we thought we’d look at the world’s top economies by a range of measures, handing out medals in various categories. Which countries are best positioned to “bring home the gold”?

To set the stage, let’s focus on the 20 largest economies.

Notably, Latin America is barely represented (with just two economies), and Africa, despite recent solid gains, fails to make this group.

While broad national measures help set up comparisons, many citizens really care about their own personal stakes in the economy. So a personal sense of economic well-being starts and ends with a job. Some countries have remarkably strong employment trends, which is no mean feat in this challenged economic time. So which countries take home the gold for employment?

UNEMPLOYMENT
Gold: Switzerland (3.1%)
Silver: South Korea (3.7%)
Bronze: China (4.1%)

With Japan posting a reported 4.5% unemployment rate, Asia is home to three of the top four listed in this metric. (However, note that these numbers are largely provided by host governments to the Organisation for Economic Co-operation and Development, known as the OECD, and are sometimes fudged.) With an eye-popping 24.6% unemployment rate, Spain wins the booby prize. Spain has always had a tough time working toward full employment, even when times are good, which some economists attribute to an educational system that leaves some graduates unprepared in a global economy.

ECONOMIC FREEDOM
Gold: Australia (83.1)
Silver: Switzerland (81.1)
Bronze: Canada (79.9)

The Heritage Foundation, a conservative think tank, has long sought to bring attention to governments that create hostile environments for their citizens. And it offers up a “freedom score,” listed above, that measures countries by a range of variables such as property rights and the economic conditions for entrepreneurs. It should come as no surprise that North Korea and Zimbabwe bring up the rear, which may help explain why those nations have some of the most poorly performing economies in the world.

Yet even among the world’s top economies, you’ll find a few examples of a lack of economic liberty. Indonesia, India and Russia get low marks, as each country has been chronically beset by corruption. However, notably, the Indonesian government has made an anti-corruption push a key national priority, and a rise in the rankings may be the result. Across the Bay of Bengal, the Indian media is captivated by anti-corruption activist Anna Hazare, who has already shamed the government into toughening up bribery laws. If you are seeking a new country in which to launch a business, Australia, Switzerland and Canada get the highest marks in this category.

NATIONAL CREDIT RATING
Gold: Australia (AAA)
Gold: Switzerland (AAA)
Gold: Canada (AAA)

Roughly a decade ago, then-Vice President Dick Cheney said, “Deficits don’t matter.” We now know how much they do matter. Massive loads of debt threaten to sink economies from southern Europe to Japan. Now many governments are faced with the onerous task of not only eliminating their budget deficits but also chipping away at their mountains of debt.

Which countries have the least to worry about in terms of credit rating? Well, Standard & Poor’s rates the sovereign bonds (which are issued by a government) of more than 100 countries, assigning a rating that reflects the risk that these bonds may eventually go into default.

Six of the top 20 global economies have secured the coveted “AAA” bond rating status from S&P, but because Germany, the Netherlands and the U.K. may be called upon to pledge support for Europe’s troubled economies, we’ve decided not to give them a medal. The other three, because they are tied, all take home the gold.

AVERAGE DISPOSABLE WAGES (i.e. after taxes)
Gold: United States ($40,560)
Silver: Switzerland ($35,265)
Bronze: Canada ($32,047)

This measure may be a bit misleading as it fails to account for differences in income equality. According to the OECD, the U.S. may be home to the highest after-tax income, on average, but the gap between the top earners of the rest of the pack is considerable. And earnings shouldn’t be equated with a sense of economic well-being. Germany, for example, ranks lower than France, the U.K. or Spain by this measure (with $23,302 on average after-tax income), but German workers tend to spend freely on holidays, automobiles and other expenses as they have a high degree of confidence in their employment picture and their government’s policies.

INFLATION RATE (2011)
Gold: Japan (0.4%)
Gold: Switzerland (0.4%)
Bronze: France (2.0%)

As consumers build up retirement savings, they hate to see it eaten up by the corrosive effects of inflation. According to the Central Intelligence Agency’s World Factbook, Switzerland and Japan share the top prize, thanks in part to their super-strong currencies, which keep prices of imported goods quite low.

But be careful what you wish for. Fears are rising that Japan’s low inflation will slip into outright deflation, which is a fall in prices for goods and services. That’s bad news for anybody with debts, as asset values drop and it becomes harder to meet those debt obligations. Turkey, Russia and India bring up the rear in this group; each has an inflation rate above 6%.

TRADE BALANCE (2011)
Gold: China ($281 billion surplus)
Silver: Saudi Arabia ($151 billion)
Bronze: Germany ($149 billion)

Trade balance is a measure of foreign trade as well as the income received from foreign-owned assets (the latter factor explains why the Netherlands — a small country with huge foreign stakes — netted a hefty $64 billion trade surplus in 2011).

It should come as no surprise that the CIA’s World Factbook places these three countries on top of the leaderboard: Each possesses vast energy assets or a very competitive manufacturing base. Can you guess which country brings up the rear? That’s right, the U.S. ended 2011 with a trade deficit of $599 billion. Others provide, and we consume. Can this go on in perpetuity? Economic dogma suggests it can’t, as we’ll eventually run out of the funds needed to buy all these goods and services.

The good news: the U.S. is rapidly boosting its energy production, which may soon start to make a meaningful dent in the massive trade imbalance. In addition, a nascent trend of “insourcing” has begun: U.S. firms are shuttering Asian manufacturing facilities and are bringing jobs back home. This will only become a full-blown trend if the U.S. dollar weakens, making labor costs relatively more competitive.

 It’s time to call the winners to the victory stand. With two gold medals and three silver medals, Switzerland gets the glory (cue the Swiss national anthem). Our neighbors to the north should be proud as well: Canada takes home a gold medal and a pair of bronze medals. Besides these two, only Australia and China won more than one medal. Check out the chart below to see the overall standings.

Action to Take –> If you’re bullish on America, then this may all actually be good news — our staggering trade and budget deficits notwithstanding. As other economies grow and develop, they tend to shift their consumption patterns as wealth is acquired. That means countries like China, Brazil, Mexico, Turkey and Indonesia will build a middle class of consumers that eventually will buy U.S. goods and services regularly.

This article originally appeared on InvestingAnswers.com:
Forget China And America — These Nations Dominate In The ‘Economic Olympics’