An interesting WebmasterWorld thread has a lot of speculation around UK AdSense publishers earning more money with Google solely based on the fact of their location. Let me share publisher's comments about this.
My website had its own adsense account for 2.5 years with my home address (somewhere in Europe) until mid-last year when I moved to the UK.
I created a new adsense account with a UK address (payee name exactly the same as before), put the new adsense script in and made NO other changes to the website. In fact, the website stayed exactly the same for the last 4 years! I never set any geo-targetting anywhere, don't even know where to do that.
Result? The website now earns about 40% more than before the move (and that's happened consistently for the last 8 months compared to the previous 8 months).
Then another new UK publisher came in and said:
Let me share my own experience. I am 100% agreed with hairycoo. I moved to UK 8 months ago before this my earning was extremely low and traffic was bit higher than comparing to now. After switching adsense account my revenue increased up to 60%. My sites are hosted in US, all I replaced is adsense code more specifically publisher id and channels rest 100% is same as it was before.
The cause cannot be related to the exchange rate, so people are speculating that there is a publisher location factor in Google AdSense's Smart Pricing technique. It can be just a coincidence, but what do you think?
Forum discussion at WebmasterWorld.