Purchasing Power Europe – the Swiss at the summit

Absolute purchasing power is truly booming in Switzerland. Thanks to the exchange rate, the absolute purchasing power of the Swiss is nearly €40,000 per capita per year, yielding first place in Europe. Due to comparatively worse growth, Luxemburg has had to give up its traditional role as frontrunner.
Strikingly positive purchasing power development is being observed in Iceland. In 2013, the country was not even among the Top 10, but now Iceland is in fifth place. The skillful politics and policy for dealing with the financial crisis are clearly showing their effects with particularly good purchasing power development. In the Scandinavian countries, the economic situation is relatively stable, but exchange rates may obscure the calculations – the current decreases are thus entirely a result of exchange rate fluctuations.
The two problem children, not only in terms of purchasing power, are unsurprisingly Russia and Ukraine. Both countries have been fighting uphill battles the past few years. Absolute purchasing power in Ukraine is currently around €1,190 per capita per year, one of the lowest in the ranking. The difficult situation in Greece is also no secret. Absolute purchasing power in Greece had already plummeted below 10,000 in 2014 and continues to decline. In contrast, Cyprus appears to have gotten back on track after its own financial troubles – the situation is stabilizing and Cyprus is currently the most prosperous southern European country.
RegioData has often shown that there is considerable inequality not only between countries, but also in the development within individual countries. Nonetheless, the trend is moving toward a narrowing of the gap between rich and poor. For example in Italy, the well-known North-South gap has been closing slowly but steadily over several years now. Whereas in 2012 the difference in purchasing power between the wealthiest and poorest municipalities was still nearly €17,000, by 2014 this difference had decreased to around €15,500.

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