The fallacy called Per Capita Income in the Globalized World
For long economists considered per capita income as the be all and end
all of a country's economy...but there must be some thing more to it in a human
THE FALLACY CALLED PER CAPITA INCOME For long economists considered per capita income as the index of human development and a countries growth. GDP might be an index in that direction but in the globalized world the view of per-capita-income has to be changed. I have always beleived a single pivot evaluation of any economy is in-correct and mis-leading. Multiple indices must always be developed.For one the concept of per capita income is rooted in want and not in the setting of plenty. There can be startling exceptions under steady state of the economy. Per Capita income by itself is inappropriate in a knowledge economy. Per capita income was an appropriate index in the labour dominated organizations of yester years.
Just evaluating countries and economies on this basis is misleading.What then should be the index of measuring economies and their standing?Well it is important to understand that human beings are more human than a resource. A more broad based index must cover various aspects of human life and existence.
Firstly communities must be judged based on a relation ship index which largely revolves on the ability of various individuals to maintain the kind of relationships they are supposed to under normal circumstances and an example of that would be family relations. Any economy incessantly at strain on such issues can never be a developed economy leastly said. This would also encompass relationships at the work place and other social settings. Creating high relationship index is key to a better economy. Various societies vary in this context. Such an index tries to measure the level of conflict in social settings. Relationship has economic moorings; which means better the relations better the ability of communities to create and distribute wealth.
Secondly any community must be able to monitor the health index of its individuals not from the stand point of cure but from the intrinsic ability to avoid ill health. Ill health has its roots in wrong living simply said. The ability to mitigate the number of unwell people is key to a developed community. There are many fairly well to do communities in the world which may not be well off but well set on such fronts. The countries of the world which enjoy a high per capita income are not devoid of sick people of varying kinds. No particular reason can be attributed for such issues but adequate research must go in from time to time to evaluate overall causes for human being not fully well or totally unwell. Such instances on the rise increase costs and diverts attention which could have otherwise been put to constructive use.
Thirdly far from mere employment any society must be able to give its people occupations and not jobs. Income generated by individuals from vocations which they think need not have been fundamentally theirs is no income at all. Vocations must give a community psychic income to a large measure. People must not feel trapped in some form of vocation or occupation. There must be sufficient lateral ability for an individual to move to vocations that give him long term enrichment and development. This would mean many things. Constant innovations and definitions and creation of fresh oppurtunities of various kinds both by the state and individuals should be a top prerogative of planners and executioners of the economy.
Lastly any economy must have large scope for the creation and maintenance of micro enterprises as against the creation of large enterprises. The ability of so called developing economies to create and sustain such enterprises is what is making them note- worthy to the world. Micro enterprises may not have sustenance under several kinds of settings in the world. A large number of such enterprises spread over a vast geography has potential to contribute what an economy calls for. Through governmental lending or otherwise such enterprises must be encouraged and recognised. A country is not poor as long as the people see and feel the winds of policies breezing in the correct direction. A largely populous nation has one great asset---its people. Through collective actualization great economic results get begotten simply said. It is an explosive waiting to explode; larger the impact more inclusive of people it is. India has a country has seen in parts and in bits and peices such large scale development though lopsided in the recent past post globalization.That per capita income is a fallacy can be seen in the vague satisfaction that the so called developed economies of the world had for ages in the way such pointers inclined themselves to learn too late that the developing countries of the world were more developed than they previously thought.
The world must move away from one thing for sure and that is the treatment of humans at a fundamental level as a mere resource and any index so developed may have had relevance in the domains of the past and they need to look at humans as humans first and then as a resource. Conversely said any economic index must be able in toto to synchronise these two fractions in the best way possible. India as a country is criticised by the world for its infrastructure and roads. ( Even Jeffrey Immelt of GE did this on TV once though in the right tone and spirit) Progress is being seen on these sectors. In the final analysis it is not infrastructure or roads that singularly determine national progress. They form definitely a component but side-by-side many issues must be addressed to ensure that the indices of an economic kind that we humanity develop from time to time to meter our progress is not mis-inclined but covers all the domains it invariably has to.