RE: The realityof the mistake of Brexit3 Jun 2023 11:12
GDP measures the size of economies, in this case regional economies, but not all of the income produced is claimed by people in those regions. For example, people that live overseas can make investments in London, and then claim income from them.
That means that GDP per person measures the wealth of regions, and Eurostat says it does not “measure the income ultimately available to private households of a region” - i.e. how "rich" or "poor" they are .
Also, when producing the figures, Eurostat adjusts GDP for price differences between countries, so you can compare the economic activity of different regions, regardless of their price levels. But this amount is set at a national level, so doesn’t account for the fact that price levels in some regions may differ from other regions within the same country (London is a much more expensive place to live than the rest of the UK, for instance).
So some regions with price levels lower than the national average may appear poorer than they actually are, and vice-versa.
The analysis compares the UK regions against nearby countries
The Inequality Briefing poster compared UK regions to other regions in “northern Europe”. Specifically that’s regions in Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Luxembourg, the Netherlands and Sweden.
The analysis also excludes overseas territories (such as some of France’s overseas territories in the Caribbean which would otherwise be included in the bottom ten).
Inequality Briefing say they chose those countries as they’re economically similar and nearby.
What you include in “northern Europe” is subjective but, for instance, the UN includes the Baltic nations (Estonia, Latvia and Lithuania) in the category of “northern Europe”. All these countries would be in the bottom 10 regions for GDP per capita, if included. The UN also includes countries not covered by the EU data, like Iceland, in northern Europe and exclude countries including Germany and France (they’re in “Western Europe”).
Going beyond northern Europe to other high-income EU countries, Spain and Italy have regions with lower GDP per person than the poorest UK regions.
This map shows how GDP per person varies across the EU, the more red a region is the further below the EU average it is in terms of GDP per person, the more green it is, the further above the EU average.
Wealth across the EU
GDP per person as a percentage of EU average (purchasing power standard)
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