Perspectives for Growth and Income Equality in the European Monetary Union: 2012–2025

Abstract

Using national accounts data obtained from the United Nations Statistical data base, GDP by expenditure was projected to the year 2025 for each of the countries belonging to the Eurozone (excluding Estonia and Slovakia) and added to get a total for the group. The projections were based on the trends that were prevailing from 1995 to 2011 in each of the countries assuming there would be a recovery from the recessionary period of 2008 to 2009 and a return to the trend. Per capita GDP projections were obtained by dividing the projected GDP by the population projections produced by the United Nations Population Division. A projection of the labor force for each country was obtained by extrapolating the labor participation rates given by the ILO and applying them to the projected population. Unemployment was then projected to the year 2025 and consequently the unemployment rate for each year in the projected period was estimated. Income distribution and inequality was captured through the use of income share by quintile of population data available for each of the countries. The per capita GDP of the poorest and richest quintiles was projected to 2025.

Appendices

Appendix 1: Estimated Parameters

	Savings		Imports
Country	a	b	a	b	c
Austria	−43,710.49	0.4114	44,701.25	0.860	−0.117
Belgium	−38,031.89	0.3521	24,585.66	0.803	0.184
Cyprus	2,431.56	0.0081	−2,653.41	0.657	0.362
Finland	−13,384.91	0.3265	−36,147.50	0.357	0.408
France	67,638.95	0.1559	−666,516.56	0.190	0.190
Germany	−760,699.50	0.5030	−288,898.25	0.648	0.200
Greece	1,958.77	0.0992	−7,936.42	1.200	0.101
Ireland	−5,884.35	0.3976	−28,200.68	0.158	0.705
Italy	140,238.39	0.1295	−546,676.94	0.615	0.409
Luxembourg	−4,974.03	0.6002	−1,274.28	0.815	0.021
Malta	1,845.45	−0.1437	−0.14	0.841	0.065
Netherlands	−37,616.76	0.3314	−90,241.41	0.700	0.272
Portugal	30,749.09	−0.0139	−47,118.03	0.469	0.485
Slovenia	−4,203.31	0.3762	−4,774.48	0.651	0.360
Spain	68,225.08	0.1785	−258,516.64	0.175	0.483

	Harrod–Domar Model			Investment	Shares
Country	a	b	ICOR	a	b
Austria	246,986.20	0.0883	11.325	5.22265	−0.00249
Belgium	312,758.75	0.0844	11.848	−0.69207	0.00045
Cyprus	12,275.41	0.1643	6.086	−1.26402	0.00073
Finland	150,308.98	0.1193	8.382	−1.37967	0.00079
France		0.0820	12.195	−3.13389	0.00166
Germany		0.0683	14.641	3.39664	−0.00160
Greece	179,423.67	0.1099	9.099	1.96835	−0.00088
Ireland	127,452.89	0.1618	6.180	10.90044	−0.00533
Italy		0.0403	24.814	−0.55932	0.00038
Luxembourg	25,904.74	0.1680	5.952	−3.66980	0.00194
Malta	4,695.25	0.1218	8.210	20.45110	−0.01012
Netherlands	526,142.38	0.0967	10.341	2.61712	−0.00121
Portugal	166,482.22	0.0521	19.194	7.46593	−0.00361
Slovenia	26,109.70	0.1172	8.532	−2.38425	0.00132
Spain	852,913.25	0.0937	10.672	−2.25956	0.00126

Appendix 2

								GDP
						Top		per capita
	Quintiles					10%	Survey	Constant
	Q1	Q2	Q3	Q4	Q5	D10	year	2005 US$
Algeria	2.3	6.6	12.1	21	57.9	40.5	1968	3,793
Argentina	5.1	9.3	13.1	18.6	53.9	40.7	1961	4,418
Argentina	4.4	9.7	14.1	21.5	50.3	35.2	1970	5,376
Australia	3.8	12.2	18.3	26	39.7	30.9	1976	5,376
Australia	6.4	12.7	18.1	24.2	38.7	29.4	1979	23,633
Australia	4.4	11.1	17.5	24.8	42.2	25.8	1985	18,659
Australia	5.9	12	17.2	23.6	41.3	25.4	1994	25,337
Austria	5.1	10.3	15.4	22.5	46.7	30.5	1974	15,009
Austria	4.7	9.5	16.5	24.1	45.1	28.7	1976	15,809
Austria WB	8.1	13.2	17.3	22.9	38.5	23.5	1997	30,808
Austria	7.3	13.4	18.2	24.0	37.1	21.8	2010	40,717
Bangladesh	6.6	11	15.1	21.1	46.3	31.2	1974	378
Bangladesh	6.2	10.9	15	21	46.9	32	1977	357
Bangladesh	6.2	10.5	14.6	20.8	48.1	33	1982	327
Bangladesh	9.5	13.4	17	21.6	38.6	24.6	1988	370
Barbados	4	10.7	15.8	22.6	46.9	31.1	1970	3,692
Belgium	4.5	10.5	15.8	22.4	46.8	31.1	1975	19,749
Belgium	7.9	13.7	18.6	23.8	36	21.5	1978	25,178
Belgium WB	8.3	14.1	17.7	22.7	37.3	22.6	1996	32,846
Belgium	7	12.2	16.6	22.4	41.9	26.8	2001	25,095
Bolivia	5.6	9.7	14.5	22	48.2	31.7	1990	1,011
Bolivia WB	4	9.2	14.8	22.9	49.1	32	1999	1,172
Botswana	4	7.5	11	17.1	60.4	46.5	1975	992
Botswana	4.3	7.7	12	18.4	57.6	42	1982	1,438
Botswana	3.6	6.9	11.4	19.2	58.9	42.9	1985	1,148
Brazil	2	5	9.4	17	66.6	50.6	1972	1,885
Brazil	2.3	5.9	10.3	17.9	63.7	48.3	1982	3,380
Brazil	2.1	4.9	8.9	16.8	67.5	51.3	1989	3,669
Brazil WB	2	5.7	10	18	64.4	46.7	1998	5,820
Bulgaria	10.4	13.9	17.3	22.2	36.2	21.9	1992	1,327
Canada	3.8	10.7	17.9	25.6	42	23.4	1977	23,236
Canada	4.6	11	17.7	25.2	41.6	25	1981	23,245
Canada	5.7	11.8	17.7	24.6	40.2	24.1	1987	24,496
Canada	5.1	11.7	17.4	24.1	41.7	25.7	1995	24,699
Chile	3.7	6.8	10.3	16.2	62.9	48.9	1989	3,475
Chile WB	3.3	6.6	10.5	17.4	62.2	47	2000	5,657
China	6.4	11	16.4	24.4	41.8	24.6	1990	498
Colombia	2.8	7	12.1	18.6	59.4	44.6	1970	1,965
Colombia	3.6	7.6	12.6	20.4	55.8	39.5	1991	2,301
Colombia WB	2.7	6.6	10.8	18	61.8	46.5	1999	3,030
Costa Rica	4.8	9.5	13.6	21.7	50.4	33.8	1971	2,874
Costa Rica	4	9.1	14.3	21.9	50.8	34.1	1989	3,188
Costa Rica	4.2	8.9	13.7	21.7	51.5	34.8	2000	4,586
Cote d’Ivoire	3.9	6.7	11.2	19.7	58.5	41.5	1970	1,139
Cote d’Ivoire	7.3	11.9	16.3	22.3	42.2	26.9	1988	1,308
Cyprus	4.5	11.5	17.5	24.4	42.1	25.9	1984	7,364
Cyprus	6.4	11.3	15.8	22.1	44.5	29.0	2009	21,370
Czech Rep. WB	10.3	14.5	17.7	21.7	35.9	22.4	1996	7,570
Denmark	5.4	12	18.4	25.6	38.6	22.3	1981	22,561
Denmark WB	8.3	14.7	18.2	22.9	35.8	21.3	1997	38,162
Dom. Rep.	4.5	8.2	12.1	18.6	56.5	41.7	1977	2,775
Dom. Rep.	4.2	7.9	12.5	19.7	55.6	39.6	1989	1,681
Dom. Rep WB	5.1	8.6	13	20	53.3	37.9	1998	2,862
Egypt	7.2	12.2	16.5	22.2	41.9	26.9	1990	875
El Salvador	5.5	10	14.8	22.4	47.4	29.5	1977	566
El Salvad.	2.9	7.4	12.4	20.2	57.1	40.6	2000	1,246
Ethiopia	6.4	10.9	14.9	19.9	48	36.3	1970	342
Ethiopia	8.6	12.7	16.4	21.1	41.3	27.5	1981	304
Fiji	5.1	9.7	14.7	22.8	47.7	30.6	1972	2,210
Finland	2.7	10	17.3	26.4	43.6	21.2	1977	18,508
Finland	6.3	12.1	18.4	25.5	37.6	21.7	1981	20,659
Finland WB	9.6	14.1	17.5	22.1	36.7	22.6	2000	26,537
France	4.3	9.8	16.3	22.7	46.9	30.4	1970	11,596
France	4.2	10	15.7	23	47.1	30.7	1975	19,661
France	5.6	11.8	17.2	23.5	41.9	26.1	1989	24,997
France WB	7.2	12.6	17.2	22.8	40.2	25.1	1995	32,417
France INSE	8.3	13.4	17.5	22.7	38.1	23.5	2008	40,754
Germany	5.9	10.5	15.3	22.7	45.6	29.1	1970	10,986
Germany	7	11.8	17.1	23.9	40.3	24.4	1988	25,843
Germany	6	12	17.9	24.5	39.6	24	1978	22,595
Germany	7.9	13.8	18.1	23.3	36.9	22.1	2004	34,133
Ghana	7	11.3	15.8	21.8	44.1	29	1988	887
Greece	6.6	12.5	16.2	20.9	43.8	29.5	1974	8,787
Greece WB	7.1	11.4	15.8	22	43.6	28.5	1998	14,522
Greece	5.6	11.3	16.3	22.8	44.0	28.2	2005	21,468
Guatemala	3.6	7.7	11.6	19.1	58	35.8	1970	1,281
Guatemala	5.3	8.4	11.9	18	56.4	42.1	1981	2,038
Guatemala	2.1	5.8	10.5	18.6	63	46.6	1989	1,235
Guatemala	2.6	5.9	9.8	17.6	64.1	48.3	2000	1,725
Guinea-Bissa	2.1	6.5	12	20.6	58.9	42.4	1991	835
Honduras	2.7	6	10.2	17.6	63.5	47.9	1989	1,864
Honduras WB	2.7	6.7	11.8	19.9	58.9	42.2	1999	1,224
Hungary	9.1	15	19	23.5	33.4	19.1	1975	3,508
Hungary	10.9	14.8	18	22	34.4	20.8	1989	4,420
Hungary WB	8.9	12.3	16	21.2	41.6	27.4	1999	5,428
India	7	9.2	13.9	20.5	49.4	35.2	1975	481
India	8.8	12.5	16.2	21.3	41.3	27.1	1989	505
Indonesia	6.8	10.5	13.4	17.3	52	40.7	1971	330
Indonesia	6.6	7.8	12.6	23.6	49.4	34	1976	836
Indonesia	8.7	12.1	15.9	21.1	42.3	27.9	1990	940
Iran	2.7	5.5	9.6	16.8	65.4	51.2	1975	4,441
Ireland	4.6	10.8	16.9	24.4	43.3	26.5	1980	13,160
Ireland WB	7.1	11.8	15.8	22	43.3	27.6	1996	24,529
Ireland	3.7	9.3	15.4	24.0	47.6	30.0	2005	48,761
Israel	5.6	12.4	18	24.5	39.5	23.5	1976	12,533
Israel	6	12.1	17.8	24.5	39.6	23.5	1979	13,002
Israel WB	6.9	11.4	16.3	22.9	44.3	28.2	1997	22,765
Italy	6.5	11.7	16.6	23	42.2	26.6	1976	11,074
Italy	6.8	12	16.7	23.5	41	25.3	1986	17,334
Italy WB	6.5	12	16.8	22.8	42	26.8	2000	21,838
Italy	6.8	11.8	16.1	22.0	43.3	28.2	2006	30,711
Jamaica	6	9.9	14.5	21.3	48.4	32.6	1990	2,821
Japan	8.2	12.7	17	22.8	39.3	24.2	1972	11,014
Japan	8.7	13.2	17.5	23.1	37.5	22.4	1979	20,619
Japan WB	10.6	14.2	17.6	22	35.7	21.7	1993	45,603
Jordan	9	14.4	18.3	23	35.3	21	1986	3,374
Jordan	6.5	10.3	14.6	20.9	47.7	32.6	1991	1,557
Kenya	4.7	10.2	14	20.1	51	36.1	1977	1,057
Kenya	3.4	6.7	10.7	17.3	61.8	47.9	1992	536
Korea	8.1	13.1	17.1	22.4	39.3	24.2	1981	3,643
Korea	7.7	12.8	16.7	22.4	40.3	25.1	1985	3,949
Korea	7.4	12.3	16.3	21.8	42.2	27.6	1988	6,808
Korea WB	7.9	13.6	18	23.1	37.5	22.5	1998	9,182
Lesotho	2.9	6.4	11.3	19.5	60	43.6	1986	304
Lesotho	1	4.6	10.1	19.5	64.8	47.8	1988	406
Malawi	2.3	5	8	13.9	70.9	58.1	1980	572
Malaysia	3.5	7.7	12.5	20.3	56	39.9	1970	1,408
Malaysia	4.6	8.3	13	20.4	53.7	37.9	1989	3,407
Malaysia WB	4.4	8.1	12.9	20.3	54.3	38.4	1997	5,871
Mauritania	3.5	10.7	16.2	23.3	46.3	30.2	1987	1,210
Mauritius	4	7.5	11	17	60.5	46.7	1981	2,297
Mexico	3.5	7.9	13.2	21.6	53.8	39.1	1977	4,162
Mexico	4.1	7.8	12.3	19.9	55.9	39.5	1984	4,600
Mexico WB	3.1	7.2	11.7	19	59.1	43.1	2000	7,180
Morocco	3.4	7.8	12.7	20	55.9	40.2	1971	1,180
Morocco	6.6	10.5	15	21.7	46.3	30.5	1990	1,611
Nepal	6.5	10.8	14.9	20.9	47	31.9	1977	281
Nepal	9.1	12.9	16.7	21.8	39.5	25	1984	260
Netherland	8.1	13.3	17.7	22.8	38.1	23.3	1977	22,790
Netherland	7.1	13.8	17.7	23.1	38.9	23.9	1981	20,553
Netherland	8.2	13.1	18.1	23.7	36.9	21.9	1988	24,613
Netherland	7.3	12.7	17.2	22.8	40.1	25.1	1994	28,680
Netherland	6.9	12.4	17.2	23.1	40.4	25.2	2010	42,289
New Zealand	5.7	12.1	17.2	23.7	41.3	25.4	1972	12,067
New Zealand	5.1	10.8	16.2	23.2	44.7	28.7	1981	15,279
New Zealand	5.3	11.5	17	23.6	42.6	26.7	1988	20,523
New Zealand	6.4	11.4	15.8	22.6	43.8	27.8	1997	21,618
Niger	4.7	9.6	14.6	21.8	49.4	33.3	1973	455
Nigeria	5.4	9.2	13.3	19.2	52.9	38.7	1970	829
Norway	4.3	11.3	18.1	25.2	41	24.3	1976	24,902
Norway	6.2	12.8	18.9	25.3	36.7	21.2	1979	29,492
Norway	5	12	17.9	25.1	40	23.7	1982	27,153
Norway WB	9.6	14	17.2	22	37.2	23.4	2000	42,241
Pakistan	8	12.5	16.1	22.1	41.4	27	1971	832
Pakistan	7.4	11.5	15.2	20.9	45	30.3	1979	703
Pakistan	8.4	12.9	16.9	22.2	39.7	25.2	1991	604
Panama	4.6	10.6	15.5	21.9	47.4	32.2	1972	3,347
Panama	2	6.3	11.6	20.3	59.8	42.1	1989	3,394
Panama WB	2.4	6.5	11.2	19.6	60.3	43.3	2000	4,431
Peru	1.9	5.1	11	21	61	42.9	1972	1,952
Peru	4.9	9.2	13.7	21	51.4	35.4	1985	1,219
Philippines	5.5	9.2	12.9	19.1	53.3	38.8	1975	1,202
Philippines	6.5	10.1	14.4	21.2	47.8	32.1	1988	1,069
Poland WB	7.3	11.8	16.2	22.2	42.5	27.4	1999	5,041
Portugal	5.9	11.2	14.6	20.1	48.2	34.4	1974	6,211
Portugal WB	5.8	11	15.5	21.9	45.9	29.8	1997	13,386
Portugal	6.6	11.3	15.5	21.6	45	29.8	2005	18,196
Rwanda	9.7	13.1	16.7	21.6	38.9	24.6	1983	506
Senegal	3.5	7	11.6	19.3	58.6	42.8	1991	1,072
Singapore	6.5	10.3	14	20	49.2	34.4	1978	8,500
Singapore	5.1	9.9	14.6	21.4	48.9	33.5	1982	11,324
Spain	5.9	11.8	16.8	23.1	42.4	26.8	1974	8,715
Spain	6.9	12.5	17.3	23.4	40	24.6	1981	12,623
Spain WB	7.5	12.6	17	22.6	40.3	25.2	1990	18,535
Spain	5.6	11.6	16.7	23.2	42.8	27.1	2005	26,058
Sri Lanka	7.3	12	16.1	21.8	42.8	30.6	1973	818
Sri Lanka	6.1	10.8	15	21.2	46.9	31.7	1981	568
Sri Lanka	8.9	13.1	16.9	21.7	39.3	25.2	1990	655
Sweden	5.2	11	16.2	23.5	44.1	27.5	1970	18,098
Sweden	8	13.2	17.4	24.5	36.9	20.8	1981	27,745
Sweden WB	9.1	14	17.6	22.7	36.6	22.2	2000	31,457
Switzerland	5.2	11.7	16.4	22.1	44.6	29.8	1982	30,069
Switzerland w	6.9	12.7	17.3	22.9	40.3	25.2	1992	49,229
Thailand	5.1	8.2	11.7	17.9	57.1	42.8	1976	1,147
Thailand	3.4	6.7	10.5	17.1	62.2	47.8	1986	1,328
Thailand	6.1	9.4	13.5	20.3	50.7	35.3	1988	1,718
Trinidad & amp;	4.2	9.1	13.9	22.8	50	33	1975	7,216
Tobago
Trinidad & amp;	5.5	10.3	15.5	22.7	45.9	29.9	1992	5,755
Tobago WB
Tunisia	4.2	8.1	12.3	19	56.3	41.2	1975	2,510
Tunisia	5.9	10.4	15.3	22.1	46.3	30.7	1990	2,288
Uganda	5	8.9	12.8	19	54.3	35.8	1970	573
Uganda	8.5	12.1	16	21.5	41.9	27.2	1989	462
U.K.	5.8	11	17.6	24.7	41	24.8	1982	15,727
U.K. WB	6.1	11.4	16	22.5	44	28.5	1999	29,518
U.R. Tanzani	5.3	9	13.1	19.2	53.4	39.4	1975	714
U.R. Tanzani	2.4	5.7	10.4	18.7	62.7	46.5	1991	316
U.S.A.	4.2	10.8	17.1	24.5	43.3	27.1	1975	8,755
U.S.A.	4.2	10.3	16.2	24.9	44.4	27.7	1980	13,061
U.S.A.	3.9	9.6	15.6	24	46.9	30.1	1990	31,431
U.S.A.	3.6	9	14.8	22.8	49.9	33.3	2000	39,498
U.S.A.	3.4	8.7	14.7	23.2	50.4	33	2005	42,330
U.S.A.	3.3	8.5	14.6	23.4	50.3	33.4	2010	41,858
Uruguay	6	10.9	15.5	22.3	45.3	29.3	1983	3,292
Venezuela	3.6	9.4	14.2	20.8	52	36.4	1971	5,385
Venezuela	4.8	9.5	14.4	21.9	49.5	33.2	1989	3,101
Venezuela	3	8.4	13.7	21.6	53.4	36.3	1998	4,556
Zambia	5.6	9.6	14.2	21	49.7	34.2	1991	559
Zimbabwe	4.5	7.4	10.6	15.5	61.7	49.3	1975	2,266
Zimbabwe	4	6.3	10	17.4	62.3	46.9	1990	1,551