„Mississippi, the poorest state in the United States, is close to surpassing Europe’s largest economy Germany’s GDP per capita.” – Euronews Business started its article of 3 January 2025 on the gross domestic product (GDP) of US member states compared with the European countries.
And of course, not only Mississippi as the poorest US state, but also the GDP per capita of large and rich US states like New York and California together with the same data of Germany, France and Italy are quite telling: for example, the German GDP per capita is less than half that of New York State.
Only Luxembourg and Ireland are above the US GDP per capita, but as the article points out they are exceptions: Luxembourg’s high GDP is partly explained by the fact that many foreign residents work in the country and thus contribute to GDP, while Ireland’s GDP is distorted by the tax planning activities of US multinationals. In other words, with the exception of these two smaller EU Member States with unique economic endowments, all EU Member States have GDP per capita well below that of the US. And the EU’s GDP per capita (USD 43,353) is half that of the US (USD 86,601). Hungary is not on the list, but it is worth noting that ours is USD 25,700.
If we look at GDP per capita adjusted for purchasing power parity (PPP), the situation is a little better, but still only Luxembourg and Ireland are ahead of the US average (USD 86,601). The EU’s PPP GDP per capita is 72% of the US average, at USD 62,660.
Although today we are witnessing the beginning of opposite trends in the context of the unfolding tariff war, if we nevertheless consider the EU and the US as one economic area, the GDP per capita of this area, adjusted for purchasing power parity (PPP), would be 74,630 USD, below which all EU member states including the three largest EU economies (Germany, France, Italy) would be below and only the aforementioned Luxembourg and Ireland, as well as Denmark and the Netherlands, i.e. four EU member states in total, would be above.
It is worth looking not only at per capita figures but also at the size of economies. The Visual Capitalist graphs are an excellent illustration of this. For example, the German economy, which is the largest in the EU and almost a quarter of the EU, is smaller than the two western US states of California and Washington combined. Or the German, French and Italian economies, which account for more than half of the EU’s economy, with their US$10.3 trillion, are smaller than the combined US$10.8 trillion economies of the top four US states – California, Texas, New York and Florida. The size and distribution of the US economy of USD 29 trillion and the EU economy of USD 19 trillion has an impact on everything and it is worth bearing this in mind at all times, including when the EU and its Member States are negotiating more and more disputes with the US.
