Level of per capita GDP depends upon which of the following?
- 1. Proportion of population in the working age
- 2. Work participation rate
- 3. Per worker productivity
Select the correct answer using the code given below.
3 only
1 and 3 only
1 and 2 only
1, 2 and 3
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC CDS-1 – 2024
– Total GDP can be expressed as the product of the number of workers and the productivity per worker (GDP / Number of Workers).
– The number of workers is determined by the total population, the proportion of that population that is of working age, and the proportion of the working-age population that is employed or seeking work (work participation rate).
– Mathematically: Per Capita GDP = (GDP / Number of Workers) * (Number of Workers / Working Age Population) * (Working Age Population / Total Population) * (Total Population / Total Population)
– This simplifies to: Per Capita GDP = (Per Worker Productivity) * (Work Participation Rate among working age) * (Proportion of Population in Working Age). (Or variants depending on how WPR is defined, but the dependence is clear).
– Therefore, the level of per capita GDP depends on all three factors:
– Proportion of population in the working age (influences the potential labor force).
– Work participation rate (influences how much of the potential labor force is actually working).
– Per worker productivity (influences how much each worker produces).