Real GDP Per Capita and the Standard of Living
Economy | Information | History | Online | Facts | World | Global | Money
They say what matters most in life are the things money can’t buy. So far, we’ve been paying attention to a figure that’s intimately linked to the things money can buy. That figure is GDP, both nominal, and real. But before you write off GDP as strictly a measure of wealth, here’s something to think about. Increases in real GDP per capita also correlate to improvements in those things money can’t buy. Health. Happiness. Education. What this means is, as real GDP per capita rises, a country also tends to get related benefits. As the figure increases, people’s longevity tends to march upward along with it. Citizens tend to be better educated. Over time, growth in real GDP per capita also correlates to an increase in income for the country’s poorest citizens. But before you think of GDP per capita as a panacea for measuring human progress, here’s a caveat. GDP per capita, while useful, is not a perfect measure. For example: GDP per capita is roughly the same in Nigeria, Pakistan, and Honduras. As such, you might think the three countries have about the same standard of living. But, a much larger portion of Nigeria's population lives on less than $2/day than the other two countries. This isn’t a question of income, but of income distribution—a matter GDP per capita can’t fully address. In a way, real GDP per capita is like a thermometer reading—it gives a quick look at temperature, but it doesn’t tell us everything. It’s far from the end-all, be-all of measuring our state of well-being. Still, it’s worth understanding how GDP per capita correlates to many of the other things we care about: our health, our happiness, and our education. So join us in this video, as we work to understand how GDP per capita helps us measure a country’s standard of living. As we said: it's not a perfect measure, but it is a useful one. Macroeconomics Course: http://bit.ly/1R1PL5x Ask a question about the video: http://bit.ly/1WJcJ5w Next video: http://bit.ly/1S1CxuA Help us caption & translate this video! http://amara.org/v/H04s/
Comments
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thankyou for the important information. ☺
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sir what are your views on demonitization in India
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Super helpful. Keep up the good work!
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u r grt sir
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your the best iv seen so far
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you are doing just awesome.
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very useful
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Why they using 2 different GDP per capita? One PPP another "nominal"? There is real difference between them
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I love your vedios . Just carry on!
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Sir,could you tell me what software did you graph these charts with?Thank you.
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I love your videos! Thank you very much for putting effort to produce extremely high quality excellent educational content about economics
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Great Explanation Professor . thanks. I Wish you had some videos on Budget line/ Constraint and MRT and MRS.
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great video sir
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Thanks for posting this video
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I like your video, thanks so much. i have one question, they said trade contributes improving standard of living. is it correct sir?
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awesome lesson
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Your defense of GDP as a reliable measure of productivity completely ignores the previous lectures on the legitimacy of market based prices. GDP includes government spending therefore if the government ordered 100000000000 office chairs and paid as much for them a piece the GDP would seem amazing while the economy produced nothing but castors and fabric.
GDP is a horrible measure and it only correlates to the measures of happiness etc by accident with the vestiges of the free market providing for the populace.
GDP should really come with a government purchase deflator. -
mongolia per capita income is 11000$, That is pretty high?
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This is awesome!
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