American pundits and politicians love to contemplate the state of the American middle class, but we rarely get a sense of how it compares to the middle classes in other countries. A new report from the Pew Research Center sheds some light on this, revealing an American middle class that is notably smaller—but richer—than its equivalents across Western Europe.

Using data from Luxembourg’s Cross-National Data Center, the report paints a surprisingly complex picture of the progress of U.S. and EU middle-income earners from 1991 to 2010.

Yes, this swath of the American population has shrunk while lower and higher income tiers have grown. By contrast, Western Europe performance is decidedly mixed. The middle class is shrinking in Germany, Italy, and Spain—but growing in Ireland, the U.K., and the Netherlands.

First some qualifiers. The report has some necessary limitations: The only data available across all countries is on disposable income after tax and social security contributions. This means that housing costs, which can vary greatly, are not factored into final figures. Specifically, the report looks at people who fall in the middle income bracket, with disposable income between 66 percent and 200 percent of the country’s median income. This provides valuable information about […]