Not so, says Greg Mankiw, Professor of economics at Harvard who cites statistics that show European per-capita productivity to be much lower than American [here]. Mark Perry expands on Mankiw's point, noting that according to official statistics nearly all European countries are poorer per-capita than nearly all American states. Only little Luxembourg ranks near the top.
Professor Krugman claims that “Europe’s economic success should be obvious even without statistics.” Unfortunately, the economic statistics presented here tell a much different and bleaker story about Europe’s economic performance than Krugman portrays. Most European countries have lower per-capita GDP than even many of the poorest U.S. states, suggesting that Europe has a lot more to learn about economic growth, dynamism, and success from the U.S. than vice-versa.Read the whole thing here.
I only have two observations to make. First, none of these economists attempts to take into account the "underground economy" of illegal transactions. By all accounts these off the books deals are rampant in Europe where many people work a limited number of hours at their official jobs [the earnings from which are taxed heavily], then supplement their earnings with off the books work that is tax free. So we should not rely too heavily on official data which are incomplete. Secondly, Perry's data point out a disturbing feature of the American economy in the Twenty First Century. They show that the District of Columbia is more than twice as wealthy per capita as the richest State [Delaware].
RELATED: Whatever Krugman's skills as an economist, they certainly do not bleed over into his political analysis. Last week he argued that Obama is not placing enough blame on President Bush for his current troubles. Warner Houston replies here.