Multilateral Comparisons of Productivity among European Countries

The objective of this multilateral comparison study is to analyse differences between levels of total factor productivity among European countries for the 2000–2012 period. Our results indicate that countries in Western and Central Europe are doing better with respect to the level of productivity compared with Mediterranean and Eastern European countries. Furthermore, we observe that most of the countries experienced increases in their productivity throughout the years. The productivity increases in Western and Central European countries are mainly due to increases in output, while the increases in Mediterranean and Eastern European countries are mainly due to the more efficient use of their inputs. It is important to note that our results suggest that the less productive countries are those with the highest productivity growth. That is, the Mediterranean and Eastern European countries show a faster productivity growth compared with the Western/Central European countries.