What is GDP Per Capita?

True Tamplin

Written by True Tamplin, BSc, CEPF®
Updated on January 11, 2021

GDP Per Capita Definition?

Gross Domestic Product, or GDP, is the total value of all goods and services produced within a country’s borders during a period of time, usually annually. 

GDP per capita, or gross domestic product per capita, measures the approximate value of a country’s GDP being contributed by each member of its population. 

It is calculated by taking a country’s GDP and dividing it by the  country’s population. 

GDP per capita is often used in conjunction with GDP as a measurement of a country’s economic health and overall prosperity. 

A high GDP usually correlates with a high standard of living.

Highest GDP Per Capita in The World

GDP per capita is highly sensitive to variations in population size. 

For example, as of 2019, Luxembourg had a total GDP of $64.45 billion, ranking 69th highest in the world. 

However, given its population is only about 600,000 citizens, its GDP per capita is over $113,000; the highest of any country worldwide.

What Does GDP Per Capita Mean?

If a nation’s population growth outpaces a nation’s economic growth, the GDP per capita will be negative, even if the nation’s economic growth is positive. 

This phenomenon may occur in developing countries; even as the country’s economy grows, the population growth may outpace it, resulting in a lowered standard of living.

What Is GDP Per Capita FAQs

GDP Per Capita, or gross domestic product per capita, measures the approximate value of a country’s GDP being contributed by each member of its population.
If a nation’s population growth outpaces a nation’s economic growth, the GDP per capita will be negative, even if the nation’s economic growth is positive.
GDP per capita is highly sensitive to variations in population size.
GDP per capita is often used in conjunction with GDP as a measurement of a country’s economic health and overall prosperity.