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does real gap per capita growth make everyone better off? why or why not?

does real gap per capita growth make everyone better off? why or why not?

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Answer #1

Answer : No, growth in real GDP per capita do not make everyone better off.

Because the formula of real GDP per capita is,

Real GDP per capita = Real GDP / Population.

If real GDP increase remaining population as constant then the real GDP per capita increase. Real GDP increase when the economy's productivity increase. Increase in productivity means increase in income for population. But it does not mean that the income is increased for everyone. If income increase for some people only remaining others' income same as before then also real GDP increase which increase the per capita real GDP. Hence everyone do not become better off from the growth of real GDP per capita.

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