Only the per capita income reflect the true state of economic development .Justify this statement
Answers
Per capita income, which is defined as the income per head of a country's population, is not the foolproof measure to observe economic development.
Economic development is more about the welfare of public than just income.
Per capita income doesn't reflect the actual standard of living of the common people. It doesn't count the level of healthcare, education and such essential infrastructure facilities enjoyed by the people, which are essential benchmarks for development.
It also doesn't account the income distribution. A country with a few rich and many poor could still have a high per capita income.
Age Factor is also avoided in per capita income, for instance, in a country with a very young or very old population, per cap income may not be exactly accurate, because neither the children nor the elderly people contribute to national income.
Development is a wide concept, and apart from income, it must evaluate the socioeconomic conditions of the ordinary citizens of the country. Therefore, per capita income alone fails to be a truly reliable measure of development.
Answer:
Per capita income cannot be a true measure of development because it:
(i) Does not reveal the distribution of income.
(ii) May not increase the standard of life.
(iii) Does not take into consideration education or health.