How can we explain this gap? And what can be done to close it in the coming years? The answers to these questions essentially relate to problems and policies concerning the supply side of the European economy. Generally speaking, the divergent growth performances in the United States and Europe can be explained by different productivity performances and different demographic or labour market developments.
Although we should be aware of the statistical or methodological problems related to cross-country comparisons, productivity growth in the United States has clearly outstripped that of the euro area. The difference, however, in productivity growth rates between the United States and the euro area is much smaller when productivity is measured per hour worked rather than per person employed.