U.S. vs. Europe

In fact Bergström and Gidehag show only that Europeans work less in the market sector. But that doesn't necessarily mean that Europeans have more leisure. Work in the informal sector and unpaid work at home is probaly higher in Europe than the U.S., they speculate. If so, than this is be the result of high taxes and not of voluntary decisions.

I think Krugman is right to say that productivity is 'nearly everything' including the most telling indicator of prosperity. At one level the EU mandarins are keenly aware of the problem: they have assiduously trashed their own comprehenisve internal assessment of the productivity gap: a report to the commission by Andre Sapir and others last year. More
here, if you haven't seen Sapir's report: a marvellous thing and right on the money, in my view.

Best wishes,

Peter

The concept of work hours is more obtuse to Europeans, than it is to Americans. There were remmants of factory shelters until the 1950s, along with the seven-day workweek of the European house servants. Leisure was something to take as opprotunity beckened, while labor was life's foundation. Europpean mores have not changed to fit the Aemrican pattern, with the development of the industrial society. American labor is far more goal-oriented--get in there, and get it done; while European labor considers it to be part of a whole, but with far less trouble with the concept of Overtime. lgl

Gidehag Bergström has also done a similar earlier study as regarding "Sweden versus the US" with even more disquieting results. They contended that if Sweden were a state in the US, it would by far be the poorest.

As regards to taxes, productivity and shadow economy a recent study has been published.

"Tax Effects on Work Activity, Industry Mix and Shadow Economy Size: Evidence from Rich-Country Comparisons"

Steven J. Davis, Magnus Henrekson

NBER Working Paper No. w10509 Issued in May 2004