GDP per capita is a commonly used measure of the affluence of a country. However, it is a coarse-grained aggregate measure (it is simply the value of goods and services produced within a country divided by the population of that country) which does not provide information on how income is distributed across the different regions of a country. By considering, instead, regional GDP per capita we can obtain a more fine-grained picture of the geographic distribution of income within countries. For example, we can gain insights into:
The proportion of a country’s population that lives in regions with a GDP per capital level higher or lower than a given threshold.
The degree of geographic inequality within a country.
Much popular discussion of inequality focuses upon differences in income across a country as a whole. Such discussions run the risk of conflating differences between high-income and low income groups within a region with differences in the incomes of regions as whole (whereby both richer and poorer citizens within one region might have materially lower incomes than those in other regions).
At the other end of the spectrum, when regional analysis is conducted, it is often done at a fairly crude level of considering only the incomes of richer and poorer regions but without considering what proportion of the total population lives in those regions.
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