GDP per capita stands for Gross Domestic Product (GDP) per capita (per person). It is derived from a straightforward division of total Gross Domestic Product (GDP) by the population. Per capita GDP is typically expressed in local current currency, local constant currency or a standard unit of currency in international markets, such as the U.S. dollar (USD).
GDP per capita is an important indicator of economic performance and a useful unit to make cross-country comparisons of average living standards and economic well-being. However, GDP per capita is not a measure of personal income and using it for cross-country comparisons also has some known weaknesses. In particular, GDP per capita does not take into account income distribution in a country. In addition, cross-country comparisons based on the U.S. dollar can be distorted by exchange rate fluctuations and often don’t reflect the purchasing power in the countries being compared.
How Does GDP Per Capita Work?
Essentially, GDP per capita acts as a metric for determining a country's economic output per each person living there. Often times, rich nations with smaller populations tend to have higher per capita GDP. Once you do the math, the wealth is spread among fewer people, which raises a country's GDP.
The fact that the GDP per capita divides a country's economic output by its total population makes it a good measurement of a country's standard of living, especially since it tells you how prosperous a country feels to each of its citizens.
- GDP per capita is a country’s economic output divided by its population.
- It's a good representation of a country's standard of living.
- It also describes how much citizens benefit from their country's economy.
- Purchasing power parity compares different countries’ economic output.
Zimbabwe's GDP Per Capita
The Gross Domestic Product (GDP) per capita in Zimbabwe was last recorded at 1183.10 US dollars in 2019. The GDP per Capita in Zimbabwe is equivalent to 9 percent of the world's average. GDP per capita in Zimbabwe was expected to reach 950.00 USD by the end of 2020, according to Trading Economics global macro models and analysts expectations. In the long-term, the Zimbabwe GDP per capita was projected to trend around 800.00 USD in 2021 and 965.00 USD in 2022, according to their econometric models.