Wednesday, December 04, 2013

Two Interesting Things About The Netherlands

The Netherlands is unusually complicated when it comes to its name, especially in English. The official name is the Netherlands (Nederland in the dutch language) but it is often called Holland and in English it is called Dutch as an adjective. It is somewhat less complicated in other languages, in Swedish for example there is the related Nederländerna and Holland, but in adjective form there isn't any special words, it's just a grammatical variation of these, nederländsk and holländsk.

Why is that? Well, the source of the name the Netherlands is obvious, that's the official name. Holland is actually a region in the central parts of the country consisting of two provinces, South Holland and North Holland. These two provinces have the largest population, and the by far highest population density of all Dutch provinces and the three biggest and  most important cities, Rotterdam, Amsterdam and the Hague, are there. So Holland is the most important region of the Netherlands, and the reason why that name is used as a substitute is therefore similar to why Britain is sometimes called "England" and the Soviet Union was sometimes called "Russia". Also, "Holland" is shorter and easier to write and say than "the Netherlands".

What about "Dutch", then? It appears to have been derived from the German word for German, Deutsch,. Remove an "e" and and a "s" from that word and you get dutch. German and Dutch are different languages, but closely related, which is why English speakers have started to use that name. This confusion is evident as the ethnic German Honus Wagner was referred to as "the Flying Dutchman" and the language of the Amish community in the U.S. is often called Pennsylvania Dutch, even though it is actually a form of German.

One surprising fact about the Dutch economy is that even as the government struggles with a budget deficit of about 4% of GDP, it has a current account surplus of €60 billion, or 10% of GDP. That is a higher surplus than Germany, and all other euro area economies relative to the size of its economy. Germany's surplus is only about 7% of GDP while it has a balanced budget. The private sector financial savings rate in the Netherlands of 14% of GDP is thus twice as high as Germany's. Unfortunately for the Netherlands, that massive savings surplus however mostly reflects depressed investments rather than high savings, which is why its economy is so much weaker than most other countries with large external surpluses.


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