This chapter examines the reasons behind the major gap in labour productivity between the US and Europe. In Europe, there are both relatively fewer people at work (a lower employment to population ratio) and fewer hours worked per worker than in the US. It is shown that Europeans work less than Americans mainly because there are institutions inducing or actually forcing them to do so. Thus, Europeans can be induced to work more or less by reforming these institutions. An overview of the two parts of this book is presented.
Keywords: labour productivity, Europe, US, working hours, employment to population ratio