Paul Krugman, “Europe v America: Who’s Really Winning?”, Substack, Feb. 2d 2026

[…]. The conventional wisdom among elites on both sides of the Atlantic is that Europe is falling far behind. But I’m a skeptic. […]

So I thought I’d do a wonkish1 post, aimed primarily at economists, to explain what I think is going on. […]

First, look at EU and US gross domestic product, measured in dollars at current prices.

Chart 1 / Source: World Bank

In 2007 the EU economy was slightly larger by this measure. Now the US economy is about 50% bigger. Wow!

Or maybe not. A lot of this reflects a decline in the euro against the dollar, rather than differences in real economic growth. So this is a really bad measure to use.

An alternative is to look at growth in real GDP — GDP