But is the UK really the fourth wealthiest economy in the world? Arguably, we are the fourth largest in terms of total GDP, although our ranking relative to France is very sensitive to the exchange rate used to translate between pounds and euros.
What matters in judging wealth, however, is average GDP per person and here we are outside the top 10, although the UK’s precise ranking is again very sensitive to the exchange rate used in the comparison. Eurostat data for 2002 suggests UK average income levels are broadly similar to Germany, France and Italy.
But we are a long way behind the US and some way behind Luxembourg (which is by far the wealthiest EU country), Denmark, the Netherlands, Belgium, Austria, Switzerland and even Ireland (although the latter’s GDP data is flattered by the presence of large multi-nationals that remit much of their profits abroad).
So the UK is one of the wealthier nations, but we are not in the top five. Whether we invest enough of this wealth in public services is another question.
- John Hawksworth is head of the macroeconomics unit at PwC.
Does Darwin's theory apply to taxation? Colin ponders...
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states
Accountancy watchdog the FRC has dropped its investigation into the former chief financial officer of Tesco, nearly two years after the supermarket was engulfed in an accounting scandal
Colin imagines how Apple's logo might change in the wake of the EC's ruling over its Irish tax arrangements