GDP per capita: method of calculation

Abbreviation GDP stands for gross domestic product, which today is the main indicator of economic development.This ratio is determined by taking into account the market price of all goods and services created within the State for a period of time, which is usually equal to the year.With the growth of the index inflation can talk about economic growth, an increase in the service sector and manufacturing.Therefore, almost all the world's countries are striving to increase the GDP.

addition to the general, economists operate another important indicator - GDP per capita of the world, which is calculated by dividing the total value of goods produced (GDP) by the number of the population of a country.This indicator is primarily used for an adequate comparison of the different states of economic development based on the number of people.For example, GDP per capita in Russia is 2011 at 16,687 dollars.The country occupies the position 46 in the world ranking according to the World Bank.

GDP per capita is calculated in US dollars, taking into consideration purchasing power parity exchange state, in other words, do not take into account the rate of national currency, and the number of services and products that you can buy.

With GDP per capita bind another key indicator - labor productivity.However, in this case, the method of calculation of a somewhat different: divides the value of all goods only for the number of working people, and not on the entire population.

Some economists are critical to the calculation of GDP per capita, they talk about the unreality of this indicator.The controversy is the legitimacy of the inclusion in the calculation base value of goods and services that were produced in the territory of companies with head offices abroad.

To avoid disputes, parallel counting another indicator of the economy - the gross national product.This ratio takes into account only those goods and services that have made the organization belonging to a national capital.

GDP divided on the potential, actual, real or nominal.The latter figure is expressed in the prices of the current year, calculated according to the actual prices of the previous year after adjusting for inflation.

actual value of GDP is determined by underemployment of people of the country and the potential - with the full employment of the entire population.The difference between the indices is to display the real possibilities of the economy or inflated - potential.

applied three methods of determining the per capita GDP: the production and distribution of end use.On the first take into account the amount of factor income (profit organizations receive interest, rent and wages).This method includes the income of all economic entities, residing on the territory of the state, who are residents and non-residents.

In finding GDP via the production method used by the added value.Through the resulting indicator is the monetary value of all goods and services produced in the country per year.For the calculation base will only accept the added cost - the difference between the revenues and costs of the company intermediate (production costs of goods or services).This is not to take into account two products that make up the final product.

methodology takes into account end-use costs.In this case, GDP defines consumer spending of the population, net exports, government spending on goods and services as well as investment in manufacturing.