In this article, we will compare the United States (US) Gross Domestic Product (GDP) numbers with that of the European Union (EU) from 1980 to 2018. We will use the publicly available data from IMF (See notes at the bottom). The data for 2018 is the forecast by IMF. We won’t be presenting the forecast for 2019 and beyond because the EU numbers would change after Brexit (Britain Exit from EU). The United Kingdom (UK) is due to leave the EU on March 29, 2019.
The EU Member States
The European Union (EU) is a political and economic union of 28 countries in the Europe continent. The names of the EU countries are as follows: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovak Republic, Slovenia, Spain, Sweden, United Kingdom.
The following map shows the location of the EU countries on the Europe continent.
US vs EU - Comparing Land Area
Before we compare the US with the EU on different GDP indicators, let us compare the size of the two in terms of the land area. The US has a total land area of 9.1 million sq km. The EU has a total land area of 4.3 million sq km.
The US land area is double than that of the EU total land area. The US land area is over 14-times more than the land area of France – the EU largest country by land area.
The combined land area of EU countries is 47.5% of that of the US. The top five countries by land area in the EU are France, Spain, Sweden, Germany, and Poland. France has 7.0% land area of that of the US. Spain, Sweden, Germany, and Poland have 5.5%, 4.5%, 3.8%, and 3.4% of the land area of the US respectively. The following chart shows the land area of the US, the EU, and the countries in the EU.
US vs EU - Comparing GDP
During 1980, the US GDP was $2.9 trillion, whereas the EU GDP was $3.8 trillion. Their GDP have been growing at a similar pace. The EU has been ahead of the US on GDP during most of the years in the past. Now, the US is ahead of the EU.
Post Brexit, it will be difficult for the EU to catch up with the US on GDP.
IMF forecasts that the US GDP would reach $20.5 trillion and the EU GDP would reach $18.8 trillion by the end of 2018. If we take the UK GDP of $2.8 trillion out of the EU, then the EU GDP would get reduced to $16 trillion. The following chart shows the GDP of the US and the EU from 1980 to 2018.
The top-5 countries in the EU by GDP - Germany, the UK, France, Italy, and Spain - account for 70% of the EU total GDP in 2018.
The US GDP is five-times that of Germany, seven-times that of France and UK, 10-times of that of Italy, and 14-times of that of Spain in 2018.
The following chart shows the year 2018 GDP of the US, the EU, and the countries in the EU.
US vs EU - Comparing Population
Before comparing GDP per capita, we will compare the population of the US and the EU.
The US had a total population of 228 million in 1980. The EU had a total population of 432 million in 1980.
From 1980 to 2018, the US has added more population than the EU. The US population increased by 100 million, whereas the EU population increased by 79 million.
The US population has reached 328 million in 2018, whereas the EU population has reached 511 million. The gap between the EU and the US population has decreased from 205 million in 1980 to 183 million in 2018. The following chart shows the population of the US and the EU from 1980 to 2018.
The US population is less than two-third of the EU total population. The US population is 4-times more than Germany - the EU most populated country.
The top-5 countries in the EU by population - Germany, the UK, France, Italy, and Spain - account for 63% of the EU total population in 2018. The following chart shows the year 2018 population of the US, the EU, and the countries in the EU.
US vs EU - Comparing GDP Per Capita
The US GDP per capita during 1980 was $12,533. At that time, the EU GDP per capita was $8,799. So, the US GDP per capita was $3,754 more than that of the EU.
The EU has always been behind the US on GDP per capita. The gap between the US and the EU GDP per capita reached its maximum in 2017.
IMF forecasts the US GDP per capita to reach $62,518 in 2018, whereas the EU GDP per capita would reach $36,736. The gap between the US and the EU GDP per capita in 2018 is $25,781. The following chart shows the GDP per capita of the US and the EU from 1980 to 2018.
The US GDP per capita is 1.7-times of that of the EU in 2018 and is more than the GDP per capita of the top-10 EU countries by GDP. The following chart shows the GDP per capita of the US, the EU, and the countries in the EU for the year 2018.
US vs EU - Comparing GDP PPP
During 1980, the US GDP on a Purchasing Power Parity (GDP PPP) basis was $2.9 trillion, whereas the EU GDP PPP was $4 trillion.
The EU has always been ahead of the US in the past on GDP PPP. The EU has been ahead of the US by one to two trillion dollars on GDP PPP. However, post Brexit, the US will take over the EU on GDP PPP as well.
IMF forecasts that the US GDP PPP would reach $20.5 trillion and the EU GDP PPP would reach $22 trillion by the end of 2018. If we take the UK GDP PPP of $3 trillion out of the EU, then the EU GDP PPP would get reduced to $19 trillion. The following chart shows the GDP PPP of the US and the EU from 1980 to 2018.
The top-5 countries in the EU by GDP - Germany, the UK, France, Italy, and Spain - account for 67% of the EU total GDP in 2018. Poland is ranked sixth on GDP PPP, ahead of Netherlands and Sweden.
The US GDP PPP is five-times of Germany, seven-times of the UK and France, nine-times of Italy, and 11-times of Spain in 2018.
The following chart shows the year 2018 GDP PPP of the US, the EU, and the countries in the EU.
US vs EU - Comparing GDP PPP Per Capita
The US GDP PPP per capita during 1980 was $12,533. At that time, the EU GDP PPP per capita was $9,170. So, the US GDP PPP per capita was $3,383 more than that of the EU.
The EU has always been behind the US on GDP PPP per capita. The GDP PPP per capita gap continues to increase.
IMF forecasts the US GDP PPP per capita to reach $62,518 in 2018, whereas the EU GDP PPP per capita would reach $43,120. The gap between the US and the EU GDP PPP per capita in 2018 is $19,398. The following chart shows the GDP PPP per capita of the US and the EU from 1980 to 2018.
The US GDP PPP per capita is 1.4-times of that of the EU and is more than the GDP PPP per capita of top-10 EU countries by GDP PPP. The following chart shows the GDP PPP per capita of the US, the EU, and the countries in the EU for the year 2018.
US vs EU - Comparing Real GDP Growth
The US and the EU had a similar real GDP growth (the one computed from the GDP reported in national currencies) curve from 1980 to 2018.
Since 2008, the real GDP growth of the US and the EU has remained less than 3%.
The following chart shows the real GDP growth of the US and the EU from 1980 to 2018.
In 2018, IMF forecasts the US real GDP growth to be 2.9%. This is ahead of the EU real GDP growth of 2.2%.
The US real GDP growth is more than that of the EU top countries (by GDP), despite the fact that the US GDP is much higher. Usually, achieving more growth on higher numbers is difficult.
The following chart shows the real GDP growth of the US, the EU, and the countries in the EU for the year 2018.
US vs EU - GDP and GDP Per Capita Growth Summary
The EU GDP during 1980 was $3,804 billion and GDP per capita was $8,799. IMF forecasts the EU GDP to reach $18,769 billion and GDP per capita to reach $36,736 by 2018. This implies an increase of 5-times in the EU GDP and 4-times in the EU GDP per capita from 1980 to 2018.
The US GDP during 1980 was $2,857 billion and GDP per capita was $12,553. IMF forecasts US GDP to reach $20,513 billion and GDP per capita to reach $62,518 by 2018. This implies an increase of 7-times in the US GDP and 5-times in the US GDP per capita from 1980 to 2018.
The following chart shows the increase in GDP and GDP per capita of the US and the EU from 1980 to 2018.
Notes
1. Data Source: International Monetary Fund (IMF) World Economic Outlook (WEO) database, October 2018 edition.
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See Also
1. Wikipedia article on Brexit
2. Wikipedia article on European Union