The world is not an equal place, and some places are a lot more unequal than others.
A national political border can have incredible significance; an abstract line separating neighboring peoples, economies, even life expectancies. Using GDP per capita as an indicator (sourcing the most recent Central Intelligence Agency data), the wealth divide between these four pairs of countries is vast … even though they geographically sit side by side.
During his recent trip abroad, Republican presidential nominee Mitt Romney caused a political stir in Israel (among other places he went) when he said that “culture makes all the difference” in explaining the vast difference in GDP per capita between Israel and its Palestinian neighbors.
And it’s not hard to understand why Palestinians might have been a bit ticked off by the remark: it’s basically saying that you’d be more financially successful if you changed your lifestyle. Harder to grasp, though, is the economic concept that Romney used in his comparison.
GDP per capita: One of those terms journalists and politicos throw out there as though it was something that normal humans conversed about at the dinner table. But what does it actually mean? And how is it relevant – or not – in determining a country’s well-being?
Put simply, Gross Domestic Product (GDP) is one (of many) ways to measure a nation’s income and level of productivity. The textbook definition will tell you: it’s the the market value of all goods and services that a country produces in a given period of time (generally a year).
In normal speak: it’s all the (legal) things that are produced and sold in a country, and all the wages and profits that are earned. Basically, an indicator of economic health and wellness.
GDP per capita, then, is the total GDP value divided by the number of people who live in that country.
So, for instance, let’s imagine your family’s house is a nation unto itself (work with me here): your dad’s a carpenter and makes, say, $50,000 a year selling his furniture. Your mom’s a lawyer and makes a salary of $70,000/year. You, however, are still in school and not working and thus, not making any income (freeloader!). So, the GDP of your household would be the sum of all those incomes: $120,000.
The GDP per capita, then, would be $120,000 divided by the number of people under your roof – the three of you. So … GDP per capita = $40,000.
GDP per capita is often used as a rough estimation of a nation’s general standard of living; the higher the GDP, the higher that standard. Of course, just looking at that figure alone can be pretty misleading, especially if there’s a lot wealth inequality within a particular country. Remember, that GDP per capita is just an average – it’s the income of a representative individual in a given country.
Take the United States, for instance: GDP per capita here is one of the highest in the world. And although the overall standard of living here is pretty high compared to a lot of other countries, there are also a lot of Americans who live in poverty.
Check out this explanatory animation on GDP per capita (I know, I know - it’s econ – but it’s kind of interesting!)
Click on each marker for undergraduate cost and debt information. California State University’s 23 undergraduate campuses are in blue. University of California’s nine campuses (excluding UCSF) are in red.
Sources: The California State University; University of California; Collegedata.com
The cost of knowledge at California’s public universities ain’t what it used to be.
About 600,000 college students attend one of the 32 California State University and University of California schools (UC San Francisco is the 33rd, but doesn’t have an undergraduate program). The state has, by far, the largest network of public four-year colleges in the country. And until fairly recently, going to school at a public school in California was a really good deal for in-state students.
But recent steep cuts in higher education funding have led to major spikes in the tuition tab. Just last year, California’s public universities enacted a tuition hike of 21 percent, the steepest increase of any state, according to the College Board.
The average in-state tuition and fees for a CSU school – at about $6,500 – is still relatively affordable compared to public universities in other states, but just ten years ago it was just about a third of the cost. Tuition increases in the UC system have followed suit; undergrads can now expect to shell out more than $13,000 a year. And of course, that’s before you even begin to consider books, supplies, and room and board, which more than doubles the cost. The result: fewer options for lower-income students and more loans and debt for graduates to pay off.
Facebook CEO announces his company's plan to go public (credit: Justin Sullivan/Getty Images)
When Facebook filed for an Initial Public Offering (IPO) in February, Mark Zuckerberg wrote a public letter outlining Facebook’s mission: to bring the world closer together. With the additional investment money that an IPO would bring, he explained, Facebook would have the resources to better reach that goal.
Or, to put it another way, when Facebook goes public, it stands to make a whole lot of money. IPO’s can be a good way for companies
to have access to a lot of funding fast, Continue reading →
INCLUDES: ARTICLE AND KQED AUDIO; INVESTOPEDIA VIDEO
Credit: Scott Beale / Laughing Squid
Since 2004, when Mark Zuckerberg launched the first version of Facebook from his college dorm room, the company has been privately-owned. That means that only a handful of people – Zuckerberg, a bunch of his early co-workers, and a few private investment firms – owned shares (parts) in the company. This February, though, Facebook announced it was going “public,” which opens the door for outside investors to start thinking about buying into it. Continue reading →