It's well known that on mean GDP per capita the US remains about 40-50% higher than the the core European countries. This is due to a combination of a) higher productivity per worker hour, b) longer worker hours, c) more workers compared with non-workers.
Yet it is really rather misleading to use mean per capita GDP when trying to compare living average living standards. That Bill Gates has an income of $3bn a year (or whatever) doesn't really do much for most people's standard of living, but he does raise the average by about $10 on its own. Add a few of his friends in and your average is soaring (the top 25,000 earners increase the mean gdp per capita by about $1,000).
A better measure of the average is median per capita GDP, or basically the amount you would have to live on if 50% of the population were poorer than you, and 50% richer. These figures rare much harder to come by than average, as they are harder to calculate, requiring knowledge of everyone's income. However figures do exist for the late 1990s for median income per household.
Country's median income (US=100)
Belgium = 106
Denmark = 105
Canada = 95
France = 95
Germany = 80
UK = 76
Spain = 73
Average EU + Canada = 90
Clearly the gap is much smaller when measured in median income, and in some cases actually disappears. At the two extremes the differences are even more pronounced. At the level of those at the bottom 10%, the US is the second lowest, with median income of 32% of its median income. At the bottom is the UK at 30% of US median income. Norway at 62% of US median income, and France at 56% of US median income are the highest.
At the other end, the income to get you into the top 10%, the US is highest by far, at 189% of median income. The next highest is Belgium at 156%, and France at 146%. The UK is at 128%.
In terms of the gap between the incomes of the top 10% and the bottom 10%, the US has the largest, at 5.98 times, while Finland has the smallest at 2.13. The UK is second highest at 4.27.
posted by Matthew @ 5/21/2003 12:28:00 PM
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