A new way to measure poverty shows the US falling behind Europe
The time needed to get $1 in international dollars is 63 minutes in the US. This is about twice the average in Germany, France and the UK according to an Oxford University researcher. This suggests that average poverty is significantly higher in the US.
Comparing economies and poverty is challenging, as different measures can lead to different results. Olivier Sterck, an Associate Professor of Economics at the University of Oxford, has developed a new way to measure poverty, which he calls “average poverty”.
He finds that “average poverty is substantially higher in the US, even though average incomes are higher than in most Western European countries”.
When Gross Domestic Product (GDP) per capita is compared between the US and Europe, the figures suggest a striking result: the poorest US state rivals Germany.
In the third quarter of 2024, Mississippi, the poorest US state, had a GDP per capita of €49,780 ($53,872). In Germany, it was €51,304 in 2024 — a gap of only about €1,500.
In purchasing power parity (PPP) terms, the US is in a significantly stronger position than most EU countries, except for Luxembourg and Ireland, as a Euronews Business article shows.