Nowadays some people argue on the
reason for the critical situation of Europe in its economy, meanwhile others
turn to study the factors that originated all this crisis in order to
comprehend the chaotic economic condition.
An analyst having a reasonable level
of intellect shouldn’t cast doubt over any other reason than the one linked to
productivity, which turns to be uneven among the members of European Community.
Before delving into the subject, it should be defined productivity as concept
firstly.
Productivity by Alexander J. Field, The Concise Encyclopedia of
Economics, gives this example if your bakery business buys flour and yeast,
rents a shop and equipment, and pays for fuel, its contribution to GDP is not
the sales price of the bread made, but the difference between gross revenues
and purchased materials and services except hired labor. Your firm’s output is
what you and your employees have added to the value of the materials and
services purchased from other firms. He adds if you discover a way to rearrange
your labor force and equipment so that production is more efficient, or
discover a great new recipe for a loaf that is equally tasty but costs you less
to bake, multifactor productivity in your firm may go up, increasing your
output (value added) per hour even in the absence of any capital deepening.
Obviously this bakery would operate very different in any country member
of the European Community. This is a revealing example the reason for the chaos
that has been created.
According to Wikipedia, Productivity is a measure of the efficiency
of production. Here it is possible to highlight that what determines the
efficiency of production is human capital, and -some will argue that this is a key
factor but not the only one- there could be others like technology.
However,
this argument is refutable on terms of that it is not only the accessibility of
the existent technology that a country whether might have or not; despite
having a very high degree of technology but what determines its efficiency is
the use of this and, there human capital comes along.
Wikipedia also says that Productivity is a ratio of what is produced
to what is required to produce it. In Productivity by Alexander J. Field, The
Concise Encyclopedia of Economics, the growth of productivity –output per unit
of input- is the fundamental determinant of the growth of a country’s material
standard of living.
This concept discloses the importance of labour productivity –which
offers a dynamic measure of economic growth, competitiveness, and living
standards. So if the labour productivity is rather variable from one country to
another, no analyst or economist could expect to have the same indexes in both
economies. One of the both will show clearly any increase or decrease in their numbers
comparing with the other.
Here, two questions come along. If economies present enormous
differences in their labour productivity how can these come together as one country
in a community of members and even how could these countries associate them in
a non-commercial barriers trade?
It is studied that human and social capitals together with
competition have a significant impact on productivity growth. One paramount
factor that exercises a determinant influence on human capital is culture
–values and concepts with which a man is brought up, and which varies from one
country to another. A relative example of disparate concepts from one country
to another in Europe is the vision on work. For European southern countries
this is appreciated as curse meanwhile for European northern ones work is the
medium to create wealth and, therefore bring as result an increase in the
growth of a country’s material standard of living.
In fact, we can find that EU’s GDP is shrinking as a proportion of
world GDP. A deeper integration brings as consequence less competition among the
member states, so the benefit is higher taxes and more regulation.
Therefore, it could be stated that for better
job opportunities and higher quality education are need to improve labour productivity
and boost growth, besides if the countries of a community don’t have the same
vision about how wealth is created and their productivity index is uneven between
them their union will have some countries bearing the burden of the less
productive members and bringing chaos into their economies, plus don’t give any
chance to those countries already in chaotic conditions take some rules on
their own 
