GDP per capita, consumption per capita and comparative price levels in Europe

Relative volumes of GDP per capita The left-hand part of table 1 shows the countries' volume indices of GDP per capita. Luxembourg stands out with a GDP per capita far above any other of the countries covered. This is to a significant extent due to a particular property of the country's economy: Luxembourg has a large number of cross-border workers relative to its resident population. While they contribute substantially to GDP, these workers are not included in the population figure used to calculate GDP per capita. This does not mean that the figure for Luxembourg is wrong, but it does indicate that GDP per capita cannot be used uncritically as an accurate indicator of, for instance, residents' material living standards. Other Member States with a high GDP per capita, 20 percent or more above the EU overall level, are Ireland, the Netherlands, Austria, Sweden and Denmark. The case of Ireland is particularly interesting, because comparable statistics from a few years back used to indicate that the country had a lower GDP per capita than most of the other, old EU Member States. The positive development for Ireland continues throughout the years 2005- 2007. However, because many companies resident in Ireland are foreign-owned, it is not surprising that Ireland's consumption per capita (cf. next section) is far more in line with other EU Member States than its GDP per capita. Belgium, the United Kingdom, Finland and Germany come out at approximately the same level of GDP per capita, at 15-19 percent above the EU overall level. France, Spain and Italy are all within 10 percent above this reference level, Greece and Cyprus within 10 percent below. Among the Member States that have joined the EU since 2004, Cyprus and Slovenia are the wealthiest, while the Czech Republic and Malta are at a level similar to that of Portugal. The development for the Czech Republic seems clearly positive over the three years covered here, while the other three remain at more or less the same level. The other new Member States have a GDP per capita between 30 and 60 percent below the overall EU level. Estonia, Slovakia, Lithuania, Latvia and Romania appear to have a clearly positive development of their GDP per capita from 2005 to 2007. Bulgaria, the EU Member State with the lowest GDP per capita, and Poland also show growth. Hungary, on the other hand, appears to be stagnating for the time being. Among the non-EU countries included here, the three EFTA Member States are clearly among the high-income countries of Europe. This is particularly so in the case of Norway, a major petroleum exporter with a relatively small population, but Switzerland surpasses the Netherlands as well, although it does not reach the level of Ireland. Iceland's GDP per capita is in line with Denmark's, 19 percent above the EU overall level. On the other hand, the EU Candidate Countries Croatia and Turkey have a GDP per capita similar to some of the lower EU Member States, while the third Candidate Country, the former Yugoslav Republic of Macedonia, comes out at a level below Bulgaria's. The four Western Balkan countries without candidate status, Montenegro, Serbia, Bosnia-Herzegovina and Albania, are among the poorest in Europe in relative terms, with Albania's GDP per capita being about one quarter of that of the EU. However, two of these countries, Montenegro and Bosnia-Herzegovina, show considerable growth from 2005 to 2007.download