Measuring standard of living

Sir, – Ireland's income per head is significantly higher than the UK's when differences in price levels are taken into account. However, as Graham Gudgin pointed out in his letter on Monday (February 7th), consumption per head in Ireland is significantly lower than in the UK. A key reason for the difference is that Ireland chooses to save more of its income for use in the future than does the UK. – Yours,etc,

JOHN FITZGERALD,

(Adjunct Professor,

Department of Economics,

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Trinity College Dublin),

Dublin 16.

Sir, – Graham Gudgin makes the implausible suggestion that Ireland might have done as well economically by staying in the United Kingdom. He bases this on my calculation that Ireland’s relative economic prosperity in western Europe (measured by average consumption per head) was about the same in recent years as in 1950. But he clearly neglects that the relative position of the UK in western Europe declined substantially in that period; indeed, according to the same data source, Ireland’s prosperity has increased by over one-third relative to the UK. – Yours, etc,

PATRICK HONOHAN,

(Former governor,

Central Bank of Ireland),

Dublin 6.