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Outline four reasons why an increase in per capital income may not necessarily lead to a rise in the standard of living of the citizens

Outline four reasons why an increase in per capital income may not necessarily lead to a rise in
the standard of living of the citizens

Answers

Davis
i. Per capita income is an average and hence a mere statistics
ii. Per capita figures may be high but income may be unevenly distributed.
iii. Those not involved in the generation of the national income are also
included in the calculation
iv. Generation rise in the price of commodities/inflation may affect the
purchasing power of the citizen.
v. High taxes may erode the real value of per capita income
vi. May be obtained through a strain on people’s health
vii. Expenditure pattern by the government/individual serving debts
Githiari answered the question on September 22, 2017 at 23:25

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