Question

Why is per capita income not a reliable index of economic development.explain

Answer 1

Poverty means lack of development, where as development implies moving towards getting rid of poverty.

However development, over the long-term, implies increased living standards, improved health and well-being for all; and the achievement of whatever is regarded as a general good for the society at large.disagree with the notion that per capita income is a fully adequate indicator of the process of development, and my reasons are the following:

It does not show how equitably a country’s income is distributed

It does do not account for improving the longevity of human life nor the quality of the environment, such as pollution, environmental degradation, health, education, etc.;  particularly in underdeveloped countries

And finally, I feel that despite the fact that per capita income affects material welfare, it is wealth that determines economic welfare and not current income as such.