Japan and Germany have saving rates that are substantially higher than the U.S. As a result, they have accumulated more capital. On a per capita basis, Japan has about 22 percent more invested capital than the United States, and Germany has 13 percent more. Nevertheless, the United States creates more wealth per capita. In current U.S. dollars, the per capital real GDP for the United States is $62,794, compared to $39,290 for Japan and $47,603 for Germany.

At least part of the difference results from more efficient use of capital in the United States. Economists estimate that a unit of capital in Germany or Japan generates output that is about a third lower than that in the United States. In other words, if a $1,000,000 factory produces 1,000,000 units of output per year in the United States, a comparable factory would produce about 670,000 units of output per year in Germany or Japan.

Some claim that “Americans over consume, under save, and underinvest.” How do the figures here counter this statement?