The use and limitation of National Income as an indicator of changes in living standards

Economic data:

GDP

GDP per capita

Disposable income

Working hours

GDP figures show the total amount of income generated in the economy over a year

GDP per capita looks at the income per person in the population

GDP per capita figures allow for comparison between countries

To compare figures they need to be converted into a common currency

To make relevant comparisons also need to look at the differences in the costs of goods and services between countries – purchasing power parity