Friday, June 03, 2005

A Tale of Two Bus Drivers: A Note on Comparative Economic Well-Being

David Brooks' latest column in the NYT has sparked a blogospheric debate about the relative economic well-being of Americans and Europeans. People are flinging around lots of statistics. But the underlying issues are these (i) what metric best measures well-being? and (ii) whose well-being do we measure? I don't have the answers to these difficult questions. I offer instead Tom Friedman's best friend--an anecdote.

Travelling on the Heathrow to Oxford Express Bus last month, I overheard a conversation between the bus driver and a friend (also a bus driver), who had just returned from a visit to New Hampshire, USA. The British based Oxford bus drivers were commenting that they earned the same in pounds sterling (25,000 p.a.) as a bus driver in New Hampshire earned in dollars (also 25,000 p.a.). They were further led to comment that the New Hampshire bus driver appeared to have a much higher standard of living. Let's say they were right about the numbers, then 25,000 dollars--which is slightly less than half of median family income in New Hampshire--buys bus drivers a higher standard of living in New Hampshire than 25,000 pounds sterling--which is roughly the median family income in the UK--buys bus drivers in Oxford. Both the Oxford bus drivers said they'd move to New Hampshire in a heartbeat.

I draw no conclusions from this anecdote. I note only that neither in Oxford nor in New Hampshire could you raise a family on a bus driver's salary.

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