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Lithuania Labeled Poorest EU Nation in Controversial Study; Economist Calls Findings 'Nonsense'
🇱🇹 Lithuania /Economy & Trade

Lithuania Labeled Poorest EU Nation in Controversial Study; Economist Calls Findings 'Nonsense'

From Delfi · (7m ago) Lithuanian Critical tone

Translated from Lithuanian, summarized and contextualized by DistantNews.

TLDR

  • A recent study by Olivier Sterck suggests Lithuania is the poorest EU country based on the time it takes to earn one PPP dollar.
  • The study, using a novel methodology, found Lithuanians need 76.4 minutes to earn a dollar at purchasing power parity, placing it last among EU nations.
  • Economist Žygimantas Mauricas dismissed the study's methodology and findings as "nonsense," arguing that traditional metrics like GDP per capita show Lithuania in a much better position.

A recent study published in the "Luxembourg Times," authored by Olivier Sterck, an associate professor of economics at the University of Antwerp and Oxford, has sparked considerable debate by labeling Lithuania the poorest country in the European Union. The study employs a unique methodology, measuring the time required for a resident to earn one dollar based on purchasing power parity (PPP). According to this metric, Lithuanians need 76.4 minutes to earn such a dollar, placing the country at the bottom of the EU rankings, alongside Hungary.

This finding starkly contrasts with traditional economic indicators. For instance, based on 2021 World Bank data, Lithuania's GDP per capita significantly surpasses that of Poland, Estonia, and Latvia. This discrepancy has led prominent Lithuanian economists to question the validity of Sterck's research. Economist Žygimantas Mauricas, from Luminor bank, has been particularly vocal, calling the study's methodology "complete nonsense" and the results "rubbish."

Šiuo metu pasaulyje yra labai populiari pajamų nelygybės tema, o tyrėjai, kaip ir daugelyje kitų populiarių sričių, kuriems reikia publikuoti mokslinius straipsnius, dažnu atveju bando išrasti inovatyvių būdų, kaip paskaičiuoti iš esmės tuos pačius rodiklius, kuriuos kitais atvejais galima paskaičiuoti žymiai paprasčiau.

— Žygimantas MauricasEconomist Žygimantas Mauricas criticizes the study's methodology as an overly complex attempt to measure existing indicators, suggesting it's driven by the need for academic publication.

Mauricas argues that Sterck's approach, which involves calculating an "average poverty" metric across 1000 income categories and converting these into earning times, is an unnecessarily complicated way to measure something that can be assessed more simply. He suggests that the study is an example of researchers trying to "reinvent the wheel" to publish innovative papers on popular topics like income inequality, ultimately producing flawed conclusions. From our perspective in Lithuania, while acknowledging the importance of examining economic well-being from various angles, we rely on established metrics like GDP and strive for continuous improvement rather than accepting potentially misleading rankings based on unconventional methodologies.

Dviračio išradinėjimas būtų toks švelnus pavadinimas. Labiau šiam tyrimui tiktų „Iš didelio rašto išeina iš krašto“. Žmogus tiesiog sugalvojo, kaip dar paskaičiuoti paprastą dalyką santykinai sudėtingesniu būdu. Tai ir gavo, nepabijokime to žodžio, nesąmonę.

— Žygimantas MauricasMauricas further elaborates on his criticism, calling the study's approach an unnecessary complication that leads to nonsensical results.
DistantNews Editorial

Originally published by Delfi in Lithuanian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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