Ranking Britain’s per capita GDP to that of the various US states seems to be of recurring interest to some in the British economic media—likely because the UK ranks surprisingly low. This has given rise to “the Mississippi question”: which is more economically productive per capita, Britain or the most impoverished US state, with the lowest life expectancy?*
Last year, the Financial Times took the Mississippi question a step further, looking at GDP figures for various countries with and without their capital cities (archived). Without London, the UK now slips just below Mississippi.
This brings us to the capital city effect, tracked by the German Economic Institute since 2011. It measures the economic contribution of capital cities and the impact of hypothetically removing them (translated).
Spoiler: the results vary hugely.
As of 2015, for example, Greece’s per capita GDP without Athens would drop by nearly 20%. Germany, however, was an outlier: removing Berlin had a net positive effect, increasing per capita GDP by 0.2% (though by 2023, it has shifted negative to -0.1%).
* As of today, Britain seems to be between Alabama and South Carolina (fourth and fifth ranked, respectively).