Cost of living

GDP per capita: return to a complex indicator

GNI per inhabitant is more reliable

Luxembourg is the richest country.’ This finding certainly proves to be somewhat simplistic, but it is however not entirely wrong.

In 2016, the gross domestic product (GDP) of Luxembourg - expressed in terms of purchasing power standards - amounted to 267% of the European average, according to Eurostat.  With this figure, the Grand Duchy then stood at the top of the list of European countries.

Now in his explanations, Eurostat says a significant detail: "The high level of GDP per inhabitant in Luxembourg is partly due to the large share of cross-border workers in total employment. While contributing to GDP, they are not considered part of the resident population which is used to calculate GDP per capita.’

Indeed, the Luxembourg employment market is atypical because of the international nature of its workforce. Around 70% of the country’s workforce is made up of immigrants or border workers; In February 2016, 174,000 frontier workers worked in Luxembourg, most of them coming from France.

GNI per inhabitant is more reliable

Statec noted recently that ‘contrary to GDP per capita, which reflects the evolution of the economy as a whole, the disposable income of households per inhabitant is a suitable indicator for measuring the average standard of living in a country.’ GNI ignores earnings transferred to or from abroad and likewise, where they exist, the wages and salaries of frontier workers.

  • Updated 13-11-2017