Is Europe falling behind? – In Conversation with Paul Krugman

Krugman says Europe's prosperity gap with the US is overstated, but it needs trade-defense tools and single-market reform to manage new geoeconomic coercion risks.

• Not actually falling behind: Krugman says GDP-per-capita gaps with the US are mostly explained by Europeans taking more vacation, and living standards 'impressionistically' look similar.
• Tech gap is narrow but real: Europe lags in AI and cutting-edge IT, but he compares it to California vs. the rest of the US — even Texas lacks a Silicon Valley.

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