Showing posts with label comparative economics. Show all posts
Showing posts with label comparative economics. Show all posts

Tuesday, April 14, 2026

E.U. States and US Economies Compared Economically

Even in reporting and analyzing seemingly-objective economic data for comparative purposes, political ideology can creep in if that instinctual urge is powerful enough. Even in comparisons of political entities that are on the same level (e.g., city, region/province, kingdom, empire), “word-games” can be used to suggest that the republics being compared are on different political levels. The use of linguistic subterfuge is, I submit, underhanded and based on a stubborn refusal to admit to oneself that the two or more political entities being compared are indeed on the same level, rather than one being higher than the other. In the case of comparing GDP and GDP per capita between E.U. and U.S. states, the very fact that the states are being compared to each other, rather than a state in one union to another union (as if a state in one political union were equivalent to another union of states—a category mistake to be sure!), means that the respective states are in fact equivalent even though different labels are used according to whether a given state is in one union or another. In arguing these points, I shall juxtaposition the respective labels to highlight the absurdity of using different labels for ideological purposes.

In mid-April, 2026, Euronews, which reflects Euroskeptic language in order to appease critics of the E.U., reported that top E.U. states and U.S. republics were roughly similar in “economic size rankings.”[1] Even though E.U. states, like U.S. states, were (and had been) semi-sovereign states, Euronews belied its own economic likeness of the respective economic sizes of big states in both unions by erroneously inventing the label, “EU countries” just before “US states.” Then, in the next paragraph, the journalist used the label, “European economies” for the E.U. states yet retained US states. In English, the expression, “Something funny is going on here” is a way of applying suspicion to another person’s underlying motives. In other words, something more is going on in the writing of the article than merely comparing economic numbers. This is the idea.

The “word games” bent on subtly overlaying differentials are undercut when we turn to the numbers themselves. In terms of GDP, the list from highest to lowest shows E.U. states and U.S. states clustered: Germany, California, France, Texas, Italy, New York, Spain, and Florida. That big states in one union of states are economically equivalent to big states in the other union is good evidence that the respective states in the two unions are equivalent more generally. To take one example, the GDP of Spain in 2025 was €1.687 trillion and that of Florida was €1.624 trillion.[2] To be sure, in making more general comparisons between the two semi-sovereign states, Spain’s greater size, 3.6 times the territorial size of Florida, is significant. However, that Spain’s 505,990 square kilometers falls between the 423,970 of California and the 695,662 of Texas strongly suggests that in terms of territory, the large (and small) states of the respective unions cluster together, rather than it being the case that a large state in one union clusters with the other union overall. To be sure, the exception to this is Alaska being larger than the E.U. itself, but otherwise, the large states in the two unions cluster not only in terms of economic output, but also geographical size.

The article’s report of GDP per capita even puts some large U.S. states above even large E.U. states because New York, California, Illinois, Texas, and Florida have higher numbers than do the Netherlands, Germany, France and Italy. The bar-graph in the article even has all of the states in blue whereas the U.S. and E.U. are in other colors so those two unions could be compared to each other. Even though the graph is labeled as “EU’s top 5 economies vs. top 5 U.S. states” (notice, too, the subtle, selective use of periods in “U.S.” but not “EU” as if this means that the latter is an organization rather than a union of states!), that all of the states are shown with blue bars indicates that the states of the respective unions are equivalent (and that the unions can be compared with each other, rather than to a state).

In making the argument of state-equivalence, out of which I derived union-equivalence, I once read the ten volumes of George Bancroft’s History of the United States of America, From the Discovery of the American Continent after having taken Joanne Freeman’s Yale course on the American Revolutionary War. In writing British Colonies Forge an American Empire: A Basis for Trans-Atlantic Comparisons, I wanted to highlight that according to Bancroft’s studies, people on both sides of the Atlantic viewed the British colonies as being on the scale of the countries in Europe at the time. Bancroft reports in his texts that both the political elite in the colonies and in the British Empire’s host kingdom (i.e., Britain) tended to view the United Colonies as being on the empire- rather than kingdom-level.[3] In fact, even New England, the Mid-Atlantic, and Southern (informal) sub-groups of colonies were viewed as empires in themselves by some people! Not just a few British politicians were nervous about there being an empire (or empires!) within the empire; an empire consists of kingdom-level political entities. That both Virginia and Ireland were regarded as members of the British Empire is strong evidence that the British colonies in North America were regarded from the start in the Greek rather than the Roman sense of a colonialization (i.e., a colony constructed to be equivalent to the host country rather than as a part thereof; for example, a city-state in Greece creating another city-state). This is the historical underpinning for my conclusion that the U.S. states, rather than the U.S. itself, are equivalent to E.U. states, and therefore I submit that the claim that a state of the E.U. is equivalent to the U.S. is a political category mistake. In historical terms, no one would have claimed that a kingdom and an empire are equivalent because empires consisted of kingdoms. That both a free-standing, or free, kingdom and an empire were both sovereign does not make the two equivalent because sovereignty is merely an attribute rather than definitive.  

Comparative politics can extend beyond comparing types of political systems (e.g., democracy, autocracy) to consider the matter of equivalence in terms of city-states, regions, kingdoms, and empires. Early in the seventeenth century, the European jurisprud Althusius wrote Political Digest on federalism based on the Holy Roman Empire. In his text, he clearly distinguished between the different levels in a federation: the guilds, the cities, the regions, the kingdoms, and the empire. His theory of federalism has the next-lower being members (and thus represented) in the next-higher, with individuals being members only of the guilds. His isomorphic federalism is more the case in the E.U. than the U.S. because none of the American states have federal systems. By viewing the E.U. and the U.S. as equivalent, Althusius’s theory could be seen to be applicable to the U.S., especially in regard to that union’s large, internally heterogenous states like California, Illinois, and New York. Comparing apples with apples, and oranges with oranges in comparative politics can indeed have such significant practical benefits, but not if Europeans and Americans go on treating individual states in one union as being equivalent to the other union rather than to states thereof.

Friday, December 27, 2024

Salary Averages in the E.U. and U.S.

It can be misleading, even illusory, to cite an average statistic on the entire E.U. and U.S. when their respective member-states differ significantly in their own averages. To be sure, overall averages, such as pertain to an empire-scale union of states covering many subunits are useful in comparison with the overall average of another comparable union. Additionally, in cases in which the state averages do not differ much, the overall average for all of the states aggregated is not misleading. Abstractly, an average of numbers that ranges from 50 to 50,000 is less reflective of the facts on the ground than is an average of numbers that ranges from 50 to 60 because neither of these outliers is much different than, say, an average of 55. In contrast, especially if most of the data from 50 to 50,000 clusters around these poles, then to say that an average of 23,000 represents something actual is dubious and even misleading. It is also misleading to compare the average pertaining to one empire-scale union of states with the average of a state in another such union. Such a category mistake regarding scale and polity-types and levels is commonly made in comparing and contrasting the E.U. and U.S. In an effort to rectify the recurrent cognitive-ideological lapses bearing on trans-Atlantic comparisons and contrasts, a proper comparison of salary averages can serve as an illustration of how to compare “apples with apples, and oranges with oranges” in institutional political analysis that is comparative in application.

As for the E.U., Eurostat reported that in 2023, “the average annual full-time adjusted salary per employee ranged from €13,503 [$14,853] in Bulgaria to €81,064 [$89,170] in Luxembourg, with the EU average standing at €37,863 [$41,649].”[1] I submit that the difference of the state averages from high to low justifies using the state averages rather than citing the E.U. average except for comparing the E.U. to other empire-scale polities, such as the U.S., India, and China. As for the U.S., the average annual salary per employee ranged from $45,180 (€41,073) in Mississippi to $76,600 (€69,636) in Massachusetts, with the US average standing at was $59,384 (€53,986). Again, the difference of the state averages from high to low justifies using the state averages, except in comparing the U.S. as a whole to the E.U. as a whole. The U.S.’s $59,384 (€53,986) average is higher than the E.U.’s €37,863 ($41,649). To be sure, comparing union-to-union has its drawbacks, for the overall conclusion that salaries were on average higher in the U.S. than in the E.U. in 2023 masks the fact that Luxembourg’s average of €81,064 [$89,170] is higher than the average of $76,600 (€69,636) in Massachusetts.

I submit that the intellectual beauty in this sterling symmetry is essentially that of logic absent any distortive ideology that would push someone into comparing the average of a state in one union with another union overall. As an example of an illogical category mistake, making a list of averages on salaries per worker by listing Luxembourg as number 1 and the U.S. as #6 after Austria would omit the averages of U.S. states such as New York, California, and New Jersey whose 2023 averages are higher than those of Denmark, Ireland, Belgium, and Austria. If member-states are to be included, the states from both the E.U. and U.S. must be included to avoid a misleading and distortive category mistake. Similarly, if the U.S. average is included, so too must be that of the E.U., whether or not the state averages are included.

Having demonstrated how the common category mistakes regarding trans-Atlantic political and economic comparisons can be rectified logically, I am under no illusion that such pristine logic will gain any traction, given the sheer intractability of the Euroskeptic, or state’s rights, ideology in Europe even into the 2020s in spite of state-nationalism having spawned two long wars that went global in the preceding century. In The Structure of Scientific Revolutions, Thomas Kuhn masterfully explains why scientific revolutions as paradigm changes are typically resisted so much by scientists who are entrenched in the paradigm enjoying the inertia of the status quo. Both personal interests and emotional as well as intellectual investment in an existing paradigm play a role in elongating the existing paradigm’s life-span artificially. So too, clutching onto political and economic comparisons between a state in one empire-scale union of states and another such union had become more ideological than based in fact by 2024, with denial of logic being just one of the implicit casualties. Old Kant must be rolling in his grave.



1. Servet Yanatma, “Average Salary Rankings in Europe: Which Countries Pay the Highest,” Euronews.com, December 24, 2024. I added the dollar equivalents using the December 30, 2023 euro/dollar exchange rate of 1.1. The highest rate in 2023 was 1.12 and the lowest was 1.05.


Monday, December 9, 2024

Ranking Technological Innovation: The E.U. and U.S. as Unions of States

“With the rise of AI, self-driving cars, and wi-fi connected appliances, it can feel like innovation is everywhere these days.”[1] Lest the BBC be presumed to be referring to California, the fifth largest economy in the world, with Caltech and Stanford University, government investment in IT and data infrastructure, and a high concentration of science/technology graduates and employment, California (as well as Massachusetts) is absent from the BBC’s rankings of technologically innovative countries. So Switzerland comes up in that ranking as the world’s foremost in computer technology, while the U.S. comes in third, with states like California and Mississippi being lost in an average that does not correspond to any actual place.

Of course, Europe presents itself as myriad of republics, with the E.U. not being counted, and thus ranked, even though the U.S. rather than California or Massachusetts is counted, and thus ranked. Referring to the 2016 Milken Institute's "State Technology and Science Index," an article in Bloomberg highlights the great science and technology divide existing between the fifty states.[2] With the Index showing a strong positive correlation between a state's innovation ranking and its GDP (gross domestic product), it is obvious that averaging California or Massachusetts with Alabama and Mississippi would be misleading for any generalizations. So too would be averaging Switzerland and Romania in Europe. 

Put another way, the BBC’s ranking highlights little Finland, The Netherlands, and Denmark in the top ten, all three of which are E.U. states, and yet ignores the U.S. member states completely.  It is telling, therefore, that the Global Innovation Index Ranking of 2024 is based in part on the assumption that it is appropriate to average all the U.S. states together on technological innovation, but somehow ill-fitting to lump all of the European states (whether E.U. states or not) together. Not even a polity in Europe having full sovereignty could explain or justify the incongruency, for every E.U. state has delegated some governmental sovereignty to the E.U. Perhaps it is denial of the E.U. instantiating modern federalism that is behind the inconsistency in the Global Innovation Index Ranking for 2024. For in terms of GDP, territory, and even population (clustering) too, the E.U. states and the U.S. states are roughly equivalent (and the E.U. and U.S. are thus equivalent too). 

The Global Innovation Index Ranking 2024: Including the U.S.[3]

1.       Switzerland

2.       Sweden

3.       United States

4.       Singapore

5.       United Kingdom

6.       Republic of Korea

7.       Finland

8.       The Netherlands

9.       Germany

10.     Denmark

Averaging all of the U.S. member-states into #3 rather than listing the foremost American states in technological innovation may be what allows Denmark to be in the top ten, and perhaps this could also be said of the E.U. states on the list: Sweden, Finland, The Netherlands, and Germany. Alternatively, the following ranking, which I have assembled in a cursory manner, may be more accurate, as a consistent polity-basis for comparison replaces the false union-state equivalence:

The Global Innovation Index Ranking 2024: Including the E.U.

1.       California

2.       Massachusetts

3.       Switzerland

4.       European Union

5.       Washington

6.       South Korea

7.       Japan

8.       China

9.       United Kingdom

10.     Singapore

California is no longer held down in a lower average of all the U.S. member states, and Massachusetts and Switzerland follow close behind. The European Union’s rank of #4 reflects the averaging from Sweden to Romania. That no E.U. states are listed leaves room for the U.S. Commonwealth of Pennsylvania, mainly due to the efforts by companies in computer tech in Pittsburgh. Of course, we could refuse to sit both E.U. and U.S. states, and thereby leave more room to other areas of the globe to make the cut. Perhaps a ranking of the top 20 could include E.U. and U.S. states, but without the E.U. and U.S. themselves being ranked. We could do another ranking, using the E.U. for all of its states and the U.S. for all of its states, and thus leave room for sleeping giants in other parts of the world that are quite innovative yet are not getting credit for it. To avoid a noxious political category mistake, avoid including the U.S. (instead of its states) when the E.U. is not included while E.U. states are included.


1. Lindsey Galloway, “What It’s Like to Live in the World’s Most Innovative Countries,” BBC.com, December 5, 2024.
2. Richard Florida, "America's Great Science and Technology Divide," Bloomberg, November 1, 2016.
3. 
Lindsey Galloway, “What It’s Like to Live in the World’s Most Innovative Countries,”

Wednesday, September 24, 2014

CEO/worker Pay: Perceptual Shortcomings

According to one study of people around the world, people of different cultures, incomes, religions, and other differences show “a universal desire for smaller gaps in pay between the rich and poor” than was the actual case at the time of the survey in 2014.[1] Interestingly, the respondents didn’t have a clue how much of a gap actually existed in their respective economies. The difficulty in estimation means that the public discourse on economic inequality has been rife with erroneous assumptions. Where the error lies in the direction of minimizing the gap, we can postulate that public policy allows for greater economic inequality than would otherwise be the case.

The United States, for example, surged past Peter Drucker’s wall of 20 to 1 (CEO compensation to average worker pay), hitting 40 to 1 in 1994 and then 400 to 1 in 2005. Why would America’s silent majority put up with such economic inequality? The short answer might lie with the power of corporations in using media corporations to lull television viewers into supposing that the difference in compensation is not very significant—significance involving not only perception, but judgment as well. That is to say, whether the gap is perceived to be significant is a value judgment that can be subtly manipulated.


In spite of an actual gap of 350 to 1 (CEO compensation to unskilled worker pay) in 2014, the Americans surveyed estimated the ratio to be 30 to 1.[2] Such a perceptual judgment could have been influenced by the lack of attention on the topic in the media. The ideologicalization of American broadcast journalism—the blurring of the lines between reporting and advocating—points to just how much estimates of significance can be subject to external influence.

Considering the relatively wide actual gap being allowed to exist in the American States as of 2014, what would the public policy have looked like had the perceptions of the American public been adjusted up to 350 to 1? Would the decentralized individual voters forming majoritarian blocks demanding limits put enough pressure on their elected representatives to mitigate the power of wealth in the halls of legislatures as elections loom?  



[1] Gretchen Gavett, “CEOs Get Paid Too Much, According to Pretty Much Everyone in the World,” The Huffington Post, September 24, 2014.
[2] Ibid.