06/23/11 Stockholm, Sweden – While famed New York Times columnist and Nobel Prize-winning Keynesian Paul Krugman has written, “Europe is an economic success, and that success shows that social democracy works,” University of Michigan economics professor Mark Perry argues quite a different story.
Based on recent data from the Commerce Department’s Bureau of Economic Analysis (BEA), Perry has compared the per capita output of the 50 US states to European countries and found that as a group Europe — in terms of GDP adjusted for purchasing power parity (PPP) — has a $32,700 PPP GDP per capita, and could likely benefit from learning a little something from even humble Mississippi, the poorest US state, at $32,764. Perry also highlights how even mighty Germany falls at #47 according to his measures.
Here are the top 20 from Prof. Mark Perry’s Carpe Diem blog comparison:
Rank | State | 2010 GDP per Capita (PPP)
* District of Columbia, $168,327
* Luxembourg, $81,383
1 Alaska, $70,814
2 Delaware, $69,880
3 Wyoming, $68,162
4 Connecticut, $66,022
5 New York, $59,596
6 Massachusetts, $58,339
7 New Jersey, $55,715
8 Virginia, $53,113
9 Colorado, $52,205
* Norway, $52,013
10 California, $51,905
11 North Dakota, $51,882
12 Minnesota, $51,238
13 Maryland, $51,224
14 Washington, $50,912
15 Illinois, $50,581
16 South Dakota, $49,741
17 Texas, $49,119
18 Nebraska, $48,708
19 Hawaii, $48,697
20 Oregon, $48,590
Only two European countries — Luxembourg and Norway (the latter of which is neither part of the EU, nor does it use the euro) — even make the top 20. In fact, the list would need to extend all the way down to #31, Georgia, and #32, Utah, to find the next European nation, Switzerland, wedged in between. This is despite being the famed private banking center and, again, the non-EU, non-euro using nation that it is.
Of course, GDP adjusted by PPP does not take into consideration certain quality of life issues such as living standards, vacation time, healthcare, and a host of other factors… however, it’s interesting to note that at least by some measures, the US continues to come out ahead. You can check out the complete top-50 list in a Carpe Diem blog post on how Europe could get an economic lesson from Mississippi.
Best,
Rocky Vega,
The Daily Reckoning
Rocky Vega
Rocky Vega is publisher of Agora Financial International, where he advances the growth of Agora Financial publishing enterprises outside of the US. Previously, he was publisher of The Daily Reckoning, and founding publisher of both UrbanTurf and RFID Update -- which he ran from Brazil, Chile, and Puerto Rico -- as well as associate publisher of FierceFinance. Rocky has an honors MS from the Stockholm School of Economics and an honors BA from Harvard University, where he served on the board of directors for Let’s Go Publications, Harvard Student Agencies, and The Harvard Advocate.
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You can have Mississippi.
I’ll take France any day.
I’m somewhat stunned by the perspective taken by the author of this article. Basically it shows that Americans work harder and produce more for far less compensation in terms of quality of life.
By the calculus employed by the authors, the pre-civil war South must have been even more productive
It is possible to produce calculations in a multitude of ways that will ultimately arrive at the desired conclusion. However, producing a statistic that says Wyoming is more productive than Switzerland by any meaningful measure simply validates the truth of the folk wisdom espoused by President Truman: There are lies, damn lies and statistics.
Since I’ve left the US for Europe half a decade ago, I can assure you that this is completely wrong. But it’s a good thing that the US media still tow this line…
LOL. Look how they rated the productivity in Washington DC. Hilarious. It is the most productive place of all. LOL.
What a screwed up list.
CIRCUS CLOWNS, JOKERS, FUNNY GUYS. MAKE PEOPLE LAUGH, ROBED YOU BLIND. AT THE END OF THE DAY, POCKETS EMPTY. SPARE A DIME?
So, let’s talk about Mississippi (and or other deep south states). By all reasonable social standards, they are the pits. Violence, divorce, teen pregnancy, health issues, literacy. The imbalance between rich and poor is inconceivable to a socially responsible country, unless its initials are USA.
Per capita income means nothing in the aggregate. Take one individual who makes $500K per year and mix in 5 who make $20K. Per capita income for the group? $100K. Duh.
As you said above lies, damn lies, and statistics. And spurious economics, the dismal science.
hello from Hawaii. More on this at absolute-hawaii.com
Bobby is onto something here.
If you look at MEDIAN income figures instead of GDP per capita figures, you’d find that the US is in the middle of the western European range. This is due to the fact that income distribution in the US s much more skewed towards the rich than in Europe, a quick look at the Gini will tell you that. In the US, the top 20% receive 85% of total income.
If you look at the bottom quartile incomme level, the US drops below the W European average.
Furthermore, those differences are skewed by non-measurables like the much higher cost of education and healthcare in the US. An upper-middle class family in the US will typically spend a high percentage of
its income on private schools or college while in most of Europe those services are free or very cheap.