US High School Economics class: Why Europe will not catch up with the US

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Click to read the article below and then answer the questions:

Why Europe will not catch up with the US

Discussion Questions

• How does the US differ from Europe in terms of economic planning and outcomes, according to the author?

• How does the cultural expectation of the welfare state in Europe impact its ability to compete economically with the US?

• What role does the European single market play in the continent’s economic performance, and what are some barriers to its effectiveness?

• How does the demographic difference between the US and Europe contribute to their economic divergence?

• What natural resource advantages does the US have that Europe lacks, and how do these impact economic performance?

• How does the entrepreneurial culture in the US differ from Europe, and why is this significant for economic growth?

• What historical factors might explain why Europe performed better economically in the past compared to its performance since the millennium?

Extended Learning

Watch the video: “Puzzle of Growth: Rich Countries and Poor Countries” (8:32) and answer the following questions.

• What role does physical and human capital play in making countries richer?

• How do incentives influence economic productivity, as explained in the example of China during the Great Leap Forward?

• What are the key institutions that help foster economic growth, and why are they important?

• Why are private property rights critical for economic growth?

• Why do economic freedom and capitalism lead to economic prosperity?

Conclusion

Considering the advantages the US has for economic growth — such as its younger population, natural resources and entrepreneurial culture — why do you think these factors contribute to the US outperforming Europe economically, and could Europe adopt any of these advantages through less restrictive immigration policies? Why or why not?

Joel Miller and James Redelsheimer, Foundation for Economic Education.
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