E. Per capita growth. Per capita output is total output divided by total population. Per capita growth means producing more goods and services per person. The problem in many developing nations is that although GDP is rising, the population is rising even faster resulting in a lower per capita growth rate. Instead we should focus on median income.
Median income is a better measure because it takes into account how income is distributed.
If the growth in income goes to a small majority of individuals who receive the majority of income, the mean will rise but the median will not. Unfortunately, statistics on median is generally not collected so economists use per capita income. The Sources of Growth. Years ago it was thought that physical capital and investment were the keys to growth. The flow of investment lead to the growth of the stock of capital.