Missing from the euobserver article is how productivity in the EU has far outpaced the US while the average number of hours in the EU has significantly dropped and the average number of hours in the US has consistently increased.
That this fundamental aspect is missing in the study cited in the euobserver tells me the study is essentially nonsense.
A cursory google search brings up this:
Quote:
If we look at the standard of living (which is the revenue per head) thirty years ago, the EU was about thirty per cent behind the US. If we compare this to the situation today, we realise that it has not changed - the EU is still thirty per cent behind. So it looks like Europe is stuck fairly far behind the US and the question is - why didn't the EU catch up?
The first point I make in my paper is that you have to look behind the basic figures, and then you realise that two things have happened. One is that the productivity (i.e. production per hour) in Europe was roughly thirty per cent lower than in the US in 1970. If you look at today's situation, and particularly the EU-15, you can see that the productivity gap has nearly entirely been made up. There are even some EU countries where productivity is higher than in the US, like in France. The catch-up vis-a-vis the US has been tremendous, with a productivity growth nearly double that of the US.
So how can this be? How can GDP still be lower per person although productivity has nearly caught up with US levels? The answer is simple: what has declined are the hours worked per person. A first explanation for this will be higher levels of unemployment in Europe, early retirement and other things like this. So, if this is the explanation, then that's not very good news for Europe. However, if you look at the figures more closely, you realise that much of it comes from the hours worked per full time worker. So this means more days of vacation per full time worker, fewer hours worked per week. People go to the countryside on Friday night rather than on Saturday. A first analysis thus shows that a lot of it is down to an increase in leisure time that the Europeans have taken.
Does this account for the majority of this gap?
Well, for some countries like France, increased leisure time accounts for most of the GDP gap. But in general, there has been a sharp decline in hours worked per full time worker in Europe. These figures predate policy measures such as the introduction of the 35 hour week in France.
So, if you want to caricature the situation, you could say that the Europeans have been much more productive than people in the US, but rather than getting the benefits in the form of higher income, they have chosen more free time.
http://www.euractiv.com/Article?tcmu...type=Interview
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