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Explain two reasons why GDP per capita is often lower in the periphery regions of a country.

User Cyndia
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Final answer:

GDP per capita is lower in periphery regions due to employment in lower-wage sectors and the outflow of skilled workers known as 'brain drain.' Additionally, regional aggregates of GDP data can mask significant disparities between high-income and low-income countries within the same region.

Step-by-step explanation:

GDP per capita is often lower in the periphery regions of a country for several reasons. First, these areas tend to have employment primarily in low-wage sectors such as agriculture, mining, and harvesting of forest products, which leads to lower incomes and fewer opportunities for career advancement. Second, the periphery experiences a phenomenon known as brain drain, where educated or professional individuals leave to seek better opportunities elsewhere, often in urban centers, resulting in a workforce with lower overall productivity and innovation.

Moreover, broad regional comparisons may obscure the differences within a region that includes both high-income and low-income countries. For instance, aggregates of GDP per capita data for countries like the United States, Canada, Haiti, and Honduras will show disparities that are not as apparent when looking at North America as a single unit. The complexity and diversity within regions mean that per capita GDP might not accurately reflect economic conditions or the quality of life in individual countries.

User Srikanth Nutigattu
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