Reporters Say the Darndest Things: CNN and Per Capita GDP

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Sunday, 25 July 2010 14:18

CNN had a segment on inequality in Brazil in which it told viewers:

"The country's Gross Domestic Product -- the value of goods and services it produces -- was $2 trillion in 2009, the 10th largest in the world, according to the CIA World Factbook. But per capita income for the same year was estimated at $10,200, the 105th highest in the world. Simply stated, most of the wealth being produced is not finding its way down to most Brazilians."

Actually, per capita income reveals nothing about inequality. It is simply GDP divided by the population. Brazil has a relatively low per capita income because it has a large population. The number for per capita income would be the same if everyone had the same income or one person had it all.

The piece could have referred to Brazil's Gini index, which is a measure on inequality. At 56.7, it is one of the highest in the world, although it has been dropping in recent years.

(HT to Robert Naiman.)