11.3.4—Growth and living standards comparison

To compare economies, separate the level of real output or income per person from its growth rate, then add distribution, prices, public services, health, education and environmental context.

A poorer economy may grow faster while remaining poorer in level terms. Purchasing-power adjustments improve price comparability, but they do not remove inequality or quality differences.

Country A has real income per person of 40,000 growing 1%; Country B has 10,000 growing 6%. B is catching up faster but still has a lower current level and may distribute gains differently.

A faster growth rate does not mean a higher living standard today, and a higher average does not prove broader welfare.