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This article is truly bizarre. The main point it makes is that the top 500 US companies grew faster than the top 500 European ones in the last decade or so. B

This article is truly bizarre. The main point it makes is that the top 500 US companies grew faster than the top 500 European ones in the last decade or so. But then it quickly mention, without any further analysis, that both their GDP actually grew at a similar pace. So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. So all else being equals it means that the smaller US companies grew more slowly and that this article is simply mesuring increasing corporate inequalities (if there is such a thing). It then goes on to say, without much evidence, that this is actually good as economies of scale, supposedly more investment in R&D and increasing concentration should imply more innovation. If this article actually wants to discuss innovation, why don't it use recognised tools to do so? If you take the global innovation index, the number of Nobel price per 100'000 habitants, the number of registered patents per year or simply the size of the economy, all point to a very healthy European continent. I will even go further and say that the US should monitor much more closely increasing concentration as typically the ISPs or the energy distribution sectors show that concentration can be good for the shareholders but devastating for the consumer.

JumpCrisscross 5y ago
> the entire EU economy grew at the same speed than the US one but not its 500 bigger companies This is literally the article’s point. Europe and the U.S. grew similarly. The U.S. and China produced more large companies. (The Continent’s larger companies also being older than the other two’s.) > supposedly more investment in R&D Not supposedly, factually. The article explicitly states this. It’s the Economist; if you need a source, they’re available on Google Scholar. > take the global innovation index, the number of Nobel price per 100'000 habitants, the number of registered patents per year or simply the size of the economy Nobel prizes and patents are measures of innovation, albeit not commercial ones. Leading product centres are another. The article measure the latter. Europe has constrained its big businesses and scale-oriented entrepreneurs. America and China have not. This is a tradeoff, and we’re seeing it play out. The Economist takes one side; it’s the side of iPhones, AWS, the Falcon 9, drones and other businesses with economies of scale. It’s against social sensibilities aligned against “big business.”
- satellite2 5y ago
  I think you make an interesting point, but your analysis suggest that what is most important for you is the wow factor of innovation, not innovation itself. > Leading product centres are I disagree, leading product centres measure marketing capabilities. Why do you think EU continue growing at this pace? Because we're also producing the innovation that goes into the iPhone and are making money of the composants that goes in. How many parts do you think Siemens built for the Falcon 9? And since you like the wow factor, don't forget where neural nets where invented, big pharma (even Pfizer Covid vaccine was invented in Germany) and Spotify for instance.
  - varjag 5y ago
    The first identifiable ANN was proposed by McCulloch and Pitts in mid-1940s. First embodiments were made in the United States as well. > How many parts do you think Siemens built for the Falcon 9? Few if any Siemens parts in a rocket are irreplaceable; there's no other Falcon-9 maker though yet. It is also a separate question how would it play out for Siemens if were they starting up in Europe today.
    - AstralStorm 5y ago
      By no other Falcon-9 maker, you're ignoring the equivalent but slightly more expensive Ariane 6. Difference is around 7 million USD per launch. Both can piggyback multiple cargo pieces. The one and only difference being that SpaceX launches more often and is a bit cheaper. Also looks cooler when the booster lands. The turnaround time is similar. But Themis is coming and this advantage won't last forever. SpaceX better hope Starship stops exploding and is as cheap to operate as they hope it will be.
- j_wtf_all_taken 5y ago
  >> the entire EU economy grew at the same speed than the US one but not its 500 bigger companies > This is literally the article’s point. Europe and the U.S. grew similarly. The U.S. and China produced more large companies. (The Continent’s larger companies also being older than the other two’s.) So Europe did a better job in distributing wealth more equally, while in the US and China you got a massive concentration of wealth? So ... fuck yeah, Europe FTW.
aapl88888 5y ago
So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. This is misleading. The article says the poorer (former communist) eastern European countries got richer, which brought up the average.
- j_wtf_all_taken 5y ago
  Ok. So lets look at the US on a state level - some got terribly rich, some suffer terribly?
  - aapl88888 5y ago
    Which US part suffered terribly?
    - j_wtf_all_taken 5y ago
      Kansas
- mpweiher 5y ago
  How is this "misleading"? We want the poorer countries to get richer faster in order to close the gap. Accomplishing precisely this is a large part of EU policy. And it is working.
  - aapl88888 5y ago
    If the US had its eastern part communist, it too would have a higher average GDP from decades ago. It is basic economics.
    - mpweiher 5y ago
      GDP per capita in the US ranges from $200k (DC) to $38K (MI). https://en.wikipedia.org/wiki/List_of_states_and_territories_of_the_United_States_by_GDP https://en.wikipedia.org/wiki/List_of_states_and_territories... Lots of ways to catch up there as well. And that doesn't change the fact that that is the actual data, nothing "misleading" about it.
Hermel 5y ago
> But then it quickly mention, without any further analysis, that both their GDP actually grew at a similar pace. So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. So all else being equals it means that the smaller US companies grew more slowly and that this article is simply mesuring increasing corporate inequalities (if there is such a thing). No. About half of the European economy is the state. So having similar GDP growth while the big US companies grew faster could also just mean that the economic growth in Europe was driven by state activities (education, health care, etc.). You cannot conclude anything regarding the growth of small companies.
- j_wtf_all_taken 5y ago
  Isn't it nice that a large part of the European economy consists of stuff helping people (the "state activities" you mention) vs. the large part of the US economy that consists of hurting people?
  - ChuckNorris89 5y ago
    US creating top paying tech jobs for the working class and not taxing them to death so they can grow into a flourishing middles class is also helping people. >large part of the US economy that consists of hurting people Source? If you're talking about the defense sector then you should also know that the UK and France were several years in a row number 2 and 3 worldwide in arms sales, including to the Saudi regime.
    - tovej 5y ago
      US upward social mobility is among the worst in the world. US workers are stuck in a rat race that simply doesn't exist to the same extent in Europe.
      - ChuckNorris89 5y ago
        I beg to differ. The fact is hard working immigrants in the US have a much higher chance of becoming successful than in Europe. Pretty much all the US tech companies are now run by immigrants of minority backgrounds while, for example, Eastern European and Turkish immigrants in Germany are still regarded as cleaners and kebab salesmen, with the only notable exception they can name being the Turkish CEO of BionTech.
dalbasal 5y ago
The point of departure is market cap vs other measures. US companies have gained a lot of value, relative to their GDP contributions... hence the discrepancy.
Applejinx 5y ago
That's a little bonkers. From my perspective, if the entire EU economy grew as fast but in the US the biggest companies grabbed everything, that is a sign that conditions in the EU are going to be better, and that the fertile soil of innovation is going to be in the EU and NOT the US. That would be 'cos in my analysis (heavily influenced by concepts of artificial life and the genetic algorithm) concentration is devastating for innovation past local plateaus. It's not just 'the consumer', it's basically premature optimization, and it's a very serious concern.
dcolkitt 5y ago
> So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. So all else being equals it means that the smaller US companies grew more slowly and that this article is simply mesuring increasing corporate inequalities The flaw here is ignoring that corporate earnings are not contiguous with GDP at a country level. A country’s earnings cam grow faster than GDP, when overseas profits grow faster than domestic profits. Since most large corporates are multinationals this consideration is highly relevant. Apple has grown very fast, but since iPhones are mostly assembled in Asia and the software is booked in tax havens like Ireland, very little of that accrues in the form of US GDP. What’s much more likely than corporate inequality increasing is that US corporates have done a much better job at expanding overseas than large European corporates. This is also why American consumer expenditures are much higher than you’d predict from looking at GDP per capita. iPhones may count as Taiwanese and Irish GDP, but the huge profit margins wind up buying back AAPL stock that is largely held by American shareholders.
hasmanean 5y ago
Yeah they are measuring inequality but the subtext is that some of US companies are bigger because they have big global brands, which Europe has not produced. Remember Skype and Nokia?
hourislate 5y ago
I think you missed the part about Eastern Europe. From the article: European GDP per head is about two-thirds that of America. The figure has not fallen in the past 20 years thanks mostly to poorer eastern Europeans getting closer to Western income levels. Would suggest that as the faster GDP Growth came from Eastern European areas offsetting a stagnating GDP Growth from the rest of Europe. Am I not reading this correctly?

JumpCrisscross 5y ago

> the entire EU economy grew at the same speed than the US one but not its 500 bigger companies This is literally the article’s point. Europe and the U.S. grew similarly. The U.S. and China produced more large companies. (The Continent’s larger companies also being older than the other two’s.) > supposedly more investment in R&D Not supposedly, factually. The article explicitly states this. It’s the Economist; if you need a source, they’re available on Google Scholar. > take the global innovation index, the number of Nobel price per 100'000 habitants, the number of registered patents per year or simply the size of the economy Nobel prizes and patents are measures of innovation, albeit not commercial ones. Leading product centres are another. The article measure the latter. Europe has constrained its big businesses and scale-oriented entrepreneurs. America and China have not. This is a tradeoff, and we’re seeing it play out. The Economist takes one side; it’s the side of iPhones, AWS, the Falcon 9, drones and other businesses with economies of scale. It’s against social sensibilities aligned against “big business.”

satellite2 5y ago
I think you make an interesting point, but your analysis suggest that what is most important for you is the wow factor of innovation, not innovation itself. > Leading product centres are I disagree, leading product centres measure marketing capabilities. Why do you think EU continue growing at this pace? Because we're also producing the innovation that goes into the iPhone and are making money of the composants that goes in. How many parts do you think Siemens built for the Falcon 9? And since you like the wow factor, don't forget where neural nets where invented, big pharma (even Pfizer Covid vaccine was invented in Germany) and Spotify for instance.
- varjag 5y ago
  The first identifiable ANN was proposed by McCulloch and Pitts in mid-1940s. First embodiments were made in the United States as well. > How many parts do you think Siemens built for the Falcon 9? Few if any Siemens parts in a rocket are irreplaceable; there's no other Falcon-9 maker though yet. It is also a separate question how would it play out for Siemens if were they starting up in Europe today.
  - AstralStorm 5y ago
    By no other Falcon-9 maker, you're ignoring the equivalent but slightly more expensive Ariane 6. Difference is around 7 million USD per launch. Both can piggyback multiple cargo pieces. The one and only difference being that SpaceX launches more often and is a bit cheaper. Also looks cooler when the booster lands. The turnaround time is similar. But Themis is coming and this advantage won't last forever. SpaceX better hope Starship stops exploding and is as cheap to operate as they hope it will be.
j_wtf_all_taken 5y ago
>> the entire EU economy grew at the same speed than the US one but not its 500 bigger companies > This is literally the article’s point. Europe and the U.S. grew similarly. The U.S. and China produced more large companies. (The Continent’s larger companies also being older than the other two’s.) So Europe did a better job in distributing wealth more equally, while in the US and China you got a massive concentration of wealth? So ... fuck yeah, Europe FTW.

aapl88888 5y ago

So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. This is misleading. The article says the poorer (former communist) eastern European countries got richer, which brought up the average.

j_wtf_all_taken 5y ago
Ok. So lets look at the US on a state level - some got terribly rich, some suffer terribly?
- aapl88888 5y ago
  Which US part suffered terribly?
  - j_wtf_all_taken 5y ago
    Kansas
mpweiher 5y ago
How is this "misleading"? We want the poorer countries to get richer faster in order to close the gap. Accomplishing precisely this is a large part of EU policy. And it is working.
- aapl88888 5y ago
  If the US had its eastern part communist, it too would have a higher average GDP from decades ago. It is basic economics.
  - mpweiher 5y ago
    GDP per capita in the US ranges from $200k (DC) to $38K (MI). https://en.wikipedia.org/wiki/List_of_states_and_territories_of_the_United_States_by_GDP https://en.wikipedia.org/wiki/List_of_states_and_territories... Lots of ways to catch up there as well. And that doesn't change the fact that that is the actual data, nothing "misleading" about it.

Hermel 5y ago

> But then it quickly mention, without any further analysis, that both their GDP actually grew at a similar pace. So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. So all else being equals it means that the smaller US companies grew more slowly and that this article is simply mesuring increasing corporate inequalities (if there is such a thing). No. About half of the European economy is the state. So having similar GDP growth while the big US companies grew faster could also just mean that the economic growth in Europe was driven by state activities (education, health care, etc.). You cannot conclude anything regarding the growth of small companies.

j_wtf_all_taken 5y ago
Isn't it nice that a large part of the European economy consists of stuff helping people (the "state activities" you mention) vs. the large part of the US economy that consists of hurting people?
- ChuckNorris89 5y ago
  US creating top paying tech jobs for the working class and not taxing them to death so they can grow into a flourishing middles class is also helping people. >large part of the US economy that consists of hurting people Source? If you're talking about the defense sector then you should also know that the UK and France were several years in a row number 2 and 3 worldwide in arms sales, including to the Saudi regime.
  - tovej 5y ago
    US upward social mobility is among the worst in the world. US workers are stuck in a rat race that simply doesn't exist to the same extent in Europe.
    - ChuckNorris89 5y ago
      I beg to differ. The fact is hard working immigrants in the US have a much higher chance of becoming successful than in Europe. Pretty much all the US tech companies are now run by immigrants of minority backgrounds while, for example, Eastern European and Turkish immigrants in Germany are still regarded as cleaners and kebab salesmen, with the only notable exception they can name being the Turkish CEO of BionTech.

dalbasal 5y ago

The point of departure is market cap vs other measures. US companies have gained a lot of value, relative to their GDP contributions... hence the discrepancy.

Applejinx 5y ago

That's a little bonkers. From my perspective, if the entire EU economy grew as fast but in the US the biggest companies grabbed everything, that is a sign that conditions in the EU are going to be better, and that the fertile soil of innovation is going to be in the EU and NOT the US. That would be 'cos in my analysis (heavily influenced by concepts of artificial life and the genetic algorithm) concentration is devastating for innovation past local plateaus. It's not just 'the consumer', it's basically premature optimization, and it's a very serious concern.

dcolkitt 5y ago

> So the entire EU economy grew at the same speed than the US one but not its 500 bigger companies. So all else being equals it means that the smaller US companies grew more slowly and that this article is simply mesuring increasing corporate inequalities The flaw here is ignoring that corporate earnings are not contiguous with GDP at a country level. A country’s earnings cam grow faster than GDP, when overseas profits grow faster than domestic profits. Since most large corporates are multinationals this consideration is highly relevant. Apple has grown very fast, but since iPhones are mostly assembled in Asia and the software is booked in tax havens like Ireland, very little of that accrues in the form of US GDP. What’s much more likely than corporate inequality increasing is that US corporates have done a much better job at expanding overseas than large European corporates. This is also why American consumer expenditures are much higher than you’d predict from looking at GDP per capita. iPhones may count as Taiwanese and Irish GDP, but the huge profit margins wind up buying back AAPL stock that is largely held by American shareholders.

hasmanean 5y ago

Yeah they are measuring inequality but the subtext is that some of US companies are bigger because they have big global brands, which Europe has not produced. Remember Skype and Nokia?

hourislate 5y ago

I think you missed the part about Eastern Europe. From the article: European GDP per head is about two-thirds that of America. The figure has not fallen in the past 20 years thanks mostly to poorer eastern Europeans getting closer to Western income levels. Would suggest that as the faster GDP Growth came from Eastern European areas offsetting a stagnating GDP Growth from the rest of Europe. Am I not reading this correctly?