In this episode, Fredrik Erixon and Oscar Guinea speak about relative economic decline – more specifically the decline of the European economy in comparison to the American economy.
This conversation is based on a recent ECIPE paper on Europe’s poor economic growth and its consequences for prosperity. The Policy Brief emphasizes the importance of long-term Gross Domestic Product (GDP) per capita trends, noting that European economies have been growing closer to 1 percent per year rather than 3 percent. The EU’s economic growth has been slower compared to other developed nations, and the GDP per capita ranking of EU countries in 2021 was lower than in 2000, contributing to a widening gap between the EU and the US. The Brief suggests that the EU can achieve better growth by prioritizing economic competitiveness, especially in the face of challenges like climate change and an aging society.