Per capita income facts for kids

This map shows the average income per person in different countries in 2018. The darker green means higher income, and red means lower income.      >$60,000      $50,000 - $60,000      $40,000 - $50,000      $30,000 - $40,000      $20,000 - $30,000      $10,000 - $20,000      $5,000 - $10,000      $2,500 - $5,000      $1,000 - $2,500      <$1,000

Per capita income or average income is the average amount of money a person earns in a year. It helps us understand how much money people in a certain area generally have.

What is Per Capita Income?

Per capita income is a way to measure the average wealth of people in a country or region. It tells us the average amount of money each person would have if all the money in that area was shared equally.

How is it Calculated?

To find the per capita income, you take the total money earned in an area. Then you divide that amount by the total number of people living there. This gives you an average for each person.

Why is it Used?

This number is often used to compare how well different areas are doing economically. It helps leaders and economists understand the average living standards. The money is usually counted in euros or US dollars. These are common international currencies.

What are the Challenges?

Even though per capita income is useful, it has some downsides.

• It doesn't always show how much things cost more over time. This is called inflation.
• A few very rich people can make the average look higher. This happens even if most people don't earn much more money.
• It doesn't consider that things cost different amounts in different countries. For example, $100 might buy more in one country than another.

See also

• In Spanish: Renta per cápita para niños