We explain what per capita means and in which areas this phrase is used. Also, what are GDP per capita and consumption per capita.
What does "per capita" mean?
The phrase per capita, also written per capita, is an expression taken from Latin and can be literally translated as "per head." It is widely used in the economic and statistical fields, when studying certain indicators that refer to the average activity per person or by individual.
The expression, despite having a Latin origin, is used today completely in Spanish, which is why it is not necessary to write it in italics or with quotation marks, but with its respective accent. It is common to find it in relation to "per capita income", "per capita consumption", "entry per capita ”, among others.
GDP per capita
The Gross Domestic Product (GDP, sometimes GDP) of a country (also equivalent to your income) is a macroeconomic indicator that expresses, in a single monetary value, the total sum of your production of goods and services during a given period, which can normally be annual or quarterly. In that sense, it is a reflection of the country's economic strength, that is, of its productive capacity.
In this way, when we speak of GDP per capita, income per capita or income per capita, we refer to the relationship between the country's GDP and its number of inhabitants, so that we can know how much of the first would correspond, statistically, to every second, if evenly distributed.
Per capita GDP is often used as an indicator of people's standard of living, that is, of their economic well-being, assuming that this necessarily translates into social and cultural well-being. However, this use has been criticized for being economistic, and for ignoring Social problems structural that are not remedied simply because the country makes more money.
Consumption per capita
A case similar to the previous one, per capita consumption is nothing more than the ratio between the number of inhabitants of a country or region, and the total of the goods or products of some specific type consumed by them during a determined period of time.
This indicator can be applied to any form of consumption: from ordinary goods, such as food or personal hygiene products, to textiles, cultural goods or services of any nature, such as electricity, telephone, etc.
Per capita consumption, thus, tells us what proportion of the total consumption of a given line corresponds to each inhabitant of the country. This estimate allows us to understand how many goods or services in this sector a person consumes on average, and thus obtain relevant information regarding consumption trends, resource monitoring and the proportion between offer Y demand in that particular economic sector.