The European Union is 20 years behind the U.S. economy

May 11, 2005

Free Market Foundation

The economic performance of the European Union (EU) is about 20 years behind that of the United States, according to a study by EUROCHAMBRES, the Association of European Chambers of Commerce and Industry.

In the study, the business organisation compares the EU to the United States in terms of employment, research & development, gross domestic product (GDP) and productivity.

Researchers also found:

Europes employment level for 2003 was achieved by the United States in 1978; the EU won’t reach U.S. levels of employment until 2023, and then only if EU employment growth will exceed that of the United States by 0.5 per cent annually.

Europes R&D investment for 2002 was achieved by the United States in 1979; the EU won’t reach U.S. levels of R&D investment until 2123, and then only if EU investment will exceed that of the United States by 0.5 per cent each year.

Europes income for 2003 was achieved by the United States in 1985; the EU won’t reach U.S. levels of income per capita until 2072, and then only if EU income growth will exceed that of the United States by 0.5 per cent annually.

Additionally, productivity in Europe lags behind the United States, and it won’t reach U.S. levels until 2056 under the same growth conditions.

Source: EUROCHAMBRES Study: US Economy Ahead of EU by at Least 20 Years! Association of European Chambers of Commerce and Industry, March 11, 2005.

For text: http://www.eurochambres.be/PDF/pdf_press_2005/09-SpringBusinessForum11March05.pdf

For more on International: Institutions and Growth: http://www.ncpa.org/iss/int/

FMF Policy Bulletin/ 03 May 2005