Part of the problem is that, at any given tech level past 14, western infantry (curiously, CHINESE takes a long and commanding lead in cavalry at level 16 and keep it until level level 24 or 25) have more pips than anyone else's, often by far, which further exacerbates how far ahead they'll usually be in tech.
Yes, but that is only a minor part of the problem. The prime issue is the sheer #monarch points western nations can play with that others can't. When you can build and build and then get techs for less than 400 monarch points mid-game, you literally have the option of being tech leader or 1-2 techs behind that with enough manpower, ducat, and trade power multipliers to match what you can get from idea groups...and enough spare MP to still get those, too.
Western units really don't run away until after 26; at that level they lead 44, 40, 38, 37 (tech groups from western to muslim). That is, at level 26 western has a 7 pip infantry advantage over a tech group that is 3 places weaker, with no meaningful advantage in artillery or cavalry whatsoever. While that's a lead, at THAT point the big part of the lead is still that they got there first. It's only when they start fielding the true end-game stuff that they run away from Muslim and especially Eastern/Ottos...but in the interceding time they've run from (or started in front of by a wide margin) the other tech groups much earlier.
The other nations not only get higher costs, however, they also get the MP drain and that really hurts. Effectively techs are much more than just 50% more expensive at that point which is crazy because western already trashes them at equal tech. I think the game would be a lot more fun if other tech groups were more viable in some capacity...and not just by spamming three-deckers (Muslim hitting tech 25 can beat western at sea, simply by loading up on the heavies).