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GDP per capita measures (like aggregate GDP measures) do not account for income distribution (and tend to overstate the average income per capita). For example, South Africa during apartheid ranked high in terms of GDP per capita, but the benefits of this immense wealth and income were not shared equally among its citizens. [79]
The economic growth rate is typically calculated as real Gross domestic product (GDP) growth rate, real GDP per capita growth rate or GNI per capita growth. The "rate" of economic growth refers to the geometric annual rate of growth in GDP or GDP per capita between the first and the last year over a period of time. This growth rate represents ...
In a study of 111 countries between 1970 and 1989, Sachs and Andrew Warner concluded that the industrialized countries had a growth of 2.3% per year per capita, open economy developing countries 4.5% and closed economy developing countries had only 2%.
GDP is the mean (average) wealth rather than median (middle-point) wealth. Countries with a skewed income distribution may have a relatively high per-capita GDP while the majority of its citizens have a relatively low level of income, due to concentration of wealth in the hands of a small fraction of the population. See Gini coefficient.
Real GDP is an example of the distinction between real and nominal values in economics.Nominal gross domestic product is defined as the market value of all final goods produced in a geographical region, usually a country; this depends on the quantities of goods and services produced, and their respective prices.
Per capita income (PCI) or average income measures the average income earned per person in a given area (city, region, country, etc.) in a specified year. In many countries, per capita income is determined using regular population surveys, such as the American Community Survey . [ 1 ]
It accounts for part of the differences in cross-country per-capita income. [2] For relatively small percentage changes, the rate of TFP growth can be estimated by subtracting growth rates of labor and capital inputs from the growth rate of output. [2]
For oil-export-dependent economies, there could be substantial differences between real GDP and real GDI, due the effect of oil price volatility on the purchasing power in those countries. [1] [2] In the United States National Income and product accounts, the word GDI is use to define GDP calculated with income data rather than expenditure data ...