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Measuring GDP in Europe

  • The use of different national income standards across Europe has an impact on cross-country comparability and in some cases leads to an underestimation of GDP. It is estimated that the application of the latest standard would add US$824 billion or 3.6% to European GDP overall.
  • Most European countries use a national income accounting standard that fails to adequately record the informal economy which estimates suggest could account for between 8% and 47% of GDP in countries across the region.
  • Relatively few European countries have out of date base years and World Economics estimates that bringing these up to date could add US$8.5 billion or 0.04% to aggregate GDP for the group as a whole.
  • In total the under-measurement of GDP on all grounds noted above could add between 12% and 51% to European GDP.
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Data Releases - Growth Trackers

Eurozone Growth Tracker

  August 2017
EU19 growth at was 2.1% in Q2 2017. June data from The Eurostat Industrial Production Index increased to 106.0 in June but New car sales growth in the Eurozone eased to 2.1% in June, on a year-on-year basis.

Recent Papers on Europe

How to create a British Sovereign Wealth Fund

  A British Sovereign Wealth Fund
Britain does not possess a Sovereign Wealth Fund in contrast to Norway whose Government Pension Fund has assets of US$804 billion. There are proposals to use The Crown Estate, one of Britain’s largest property owners, as the core of a British Sovereign Wealth Fund.
France Benefits at the expense of the African Franc Zone

  France Benefits at the expense of the African Franc Zone
A recent estimate places aggregate net capital flight out of the African currency union during the period 1970 to 2010 at around US$83.5 billion,117% of combined GDP.
Are poor Germans supporting rich Spaniards?

  Are poor Germans supporting rich Spaniards?
The ECB has published a survey of household wealth across the euro area which provides further evidence of the enormous economic imbalances existing across the currency area. 

  Calculating UK inflation:
Common Sense or Common Theft

The Office of National Statistics (ONS) has launched a Retail Price Index (RPI) known as the RPIJ following a decision to implement a new eponymous averaging formula based on the work of the British nineteenth century economist William Stanley Jevons.
The Eurozone: Whatever Happened to Convergence?

  The Eurozone: Whatever Happened to Convergence?
This paper examines the degree of convergence of the economies of the Eurozone since the start of the single currency in 1999.
Measuring UK Inflation: Practical Differences and Issues

  Measuring UK Inflation: Practical Differences and Issues
Inflation is a key economic indicator that affects all economic agents. But the mechanisms by which price data are captured and aggregated are less uniform than might be expected, and there are a number of practical issues that can affect measured inflation rates.
Reflections on the Crisis in Greece

  Reflections on the Crisis in Greece
After a brief review of the origins of the crisis and the efforts that have been made to cope with it, the paper assesses the factors that explain the severity of the ongoing recession in Greece.

  EU Accounting - Making Government Accounting look good
Based on the authors’ direct experience of the inner workings of the European Union this article argues that the procedures within this supranational institution make the relatively poor standards of national government accounting look good.
The Euro Crisis: No More Safe Havens

  The Euro Crisis: No More Safe Havens
Rosner argues that German long-term bunds are not the safe haven that many have talked them up as, and that in fact the long-term underlying indicators of the German economy do not support the idea that bunds are a low-risk long-term investment.

  Breaking Up Is Hard to Do
From a position some years ago where the euro was seen as set to challenge the dollar as the world’s leading currency, there are now serious concerns that the on-going eurozone crisis will lead to some countries eventually withdrawing from it, beginning a process of European monetary disintegration.

  Why the EU’s EPA's are Likely to be Damaging for African Economies
Can Europe can dictate the future of Africa? The Economic Partnership Agreements spearheaded from Brussels are the modern day equivalent of the nineteenth century carve-up of Africa.

  Sovereign Credit Risk in the Euro Zone
What is the current state of sovereign credit risk across Euro zone? Does the recent fiscal crisis extend to other (non Euro zone) countries?

More Papers From The Archive

  The Lone Stand of Vaclav Klaus
There is a global policy consensus on the threat of global climate change is an urgent priority for all nations due to anthropogenic global warming (AGW). There is one prominent and outspoken dissenter...

  Punishing European Cartels
Antitrust authorities across the world are waging war against domestic and international cartels. The European Commission in particular has intensified its prosecution activities and increased dramatically the fines it imposes on cartelists.

  Understanding the Greek Crisis
his paper focuses on the distortions that the Greek public debt has imposed on the Greek banking system, and suggests how these can be unwound.

  The Euro Crisis
The crisis in Greece and other mainly southern Eurozone countries has been discussed primarily as a fiscal issue. Current account deficits of the same countries have received less attention in spite of the relatedness of current account and fiscal deficits.

  The Eurozone: What Now?
The financial and economic crisis in Greece in 2009/2010 has reawakened interest in the future of the euro and the eurozone. After briefly explaining its sources, this article focuses on the longer-term issues to which the crisis gives rise.

  Global Financial Crisis
This article reviews the degree of progress in financial regulatory reform and proposes new areas for inclusion in the reform agenda... 

  Greece and the State
Pervasive state intervention in Greece has mired the economy with large-scale inefficiencies and an uneven playing field, protecting insiders and rent-seekers to the detriment of its underlying growth potential, with the political class at the same time failing miserably to address the aspirations of the people.

  Greek Economic Statistics:
A Decade of Deceit

This paper looks at the problems in official Greek economic data on public finances, whose reliability has been impaired by inappropriate accounting methods, the application of poor statistical methods and misreporting.

  Carbon Commitments Must Translate into Real Action
The efforts of political leaders to negotiate a global agreement to reduce carbon emissions highlights the importance of consistent action at the domestic level. To gauge the efficacy a clear and consistent approach to carbon disclosure must be adopted by UK companies.

  Is Economic Growth Good For Us?
This article reviews Britain’s experience of economic growth in the twentieth century. It argues that average living standards have risen much more rapidly than is generally appreciated.

  How to Reform Europe’s Fiscal Policy Framework
The current budgetary problems of some EU member states have intensified the debate on Europe’s fiscal policy framework. It is not enough to change the interpretation of the Stability and Growth Pact.

  Some Proposed Methodological Developments for the UK RPI
This paper argues that the dynamic changes in product markets and consumers’ responses to price changes need to be incorporated into the RPI if it is to effectively measure changes in the cost of living.

  Measuring Consumer Inflation in the United Kingdom
Responding to Mick Silver’s proposals regarding the RPI, David Fenwick of the ONS summarises some of the issues that confront compilers of price indices.

  Extending the UK National Accounts
This article starts by comparing satellite accounts with the use of indicators to measure the quality of life. It then reports on progress with the UK environmental accounts, and with the household accounts, which measure the productive unpaid work done in the home.
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