GDP vs. GDP per Capita

Difference between GDP and GDP per Capita   GDP Every country produces goods and services within the geographic…

Difference between GDP and GDP per Capita


Every country produces goods and services within the geographic boundaries of a country annually. The total market value of this in a given year, equal to total consumer, investment and government spending, with the value of exports, minus the value of imports is called the (GDP)Gross Domestic Product. Growth in GDP is what really matters. GDP numbers are reported in two forms mainly, the current dollar which is calculated using today’s dollars and the constant dollar which solves this problem by converting the current information into some standard era dollar. This process points out the effects of inflation and allows easy comparisons between periods.

GDP per Capita
GDP per Capita is the national output wherein the GDP is divided by the population and is expressed in U.S. Dollars. Theoretically, it is the amount of money each individual gets every year. It provides a better determination of living standards as compared to GDP. A nations income is proportional to its size of population meaning, the more number of people the higher the GDP, but it doesn’t always mean that a nation with high GDP has a high standard of living. A country with an overwhelmingly large population but with high GDP indicates an unfavorable standard of living for each citizen would only get a small share to the wealth being evenly distributed.

Summary of the differenced between GDP and GDP per capita:

  • GDP is a criteria that indicates on how well or deprived a nations economy is while GDP per capita is the actual cash the average person in a given country has per year.
  • GDP per Capita is a better measure in determining the living standards of one country.


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