California’s economy has overtaken Russia and Italy, with the state now ranked as the world’s eighth-largest economy, according to the Center for Continuing Study of the California Economy.
California’s $2.203 trillion gross domestic product in 2013 put the state ahead of Russia and Italy, and just behind the No. 7 economy, Brazil. The rankings were calculated by the Center for Continuing Study of the California Economy in Palo Alto and based on annual statistics from the World Bank.
Because of slow growth in Europe, California might close in on No. 5 France and No. 6 United Kingdom in the rankings for 2014, according to economist Stephen Levy, who is director of the Palo Alto center.
Levy said that the fluctuations in the rankings shouldn’t be taken too seriously, but that the latest results do offer additional evidence that the state is hitting its stride after years of economic turmoil. California’s economy grew by 2 percent last year, whereas the U.S. average was 1.8 percent.
“It’s part of the California comeback story, California beginning to grow again,” Levy said.
Over 10 years ago California was No. 5 among the world’s economies, but it gradually slipped as growth accelerated in other parts of the world and the state took more than its share of lumps during the recession. The 2012 rankings put California at No. 10, slightly behind Russia and Italy.
The results for were boosted in part by a revision in how state gross domestic products are calculated. For the first time, business spending on intellectual property, including entertainment, was included in the statistics. As a result, California’s economic output now includes the huge sums spent on making software, movies and so on.
“We have Hollywood, we have Silicon Valley,” said Irena Asmundson, chief economist at the state Department of Finance. “This number does reflect the strength of the California economy a little better.”
But even without the revision, said Levy, California would have passed Italy and Russia in economic output.