# Why is Sri Lanka relatively wealthy for its area? **URL:** \ **Category:** Factual Questions\ **Created:** [September 7, 2014, 9:14am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741 "2014-09-07T09:14:21Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![IMfez](https://avatars.discourse-cdn.com/v4/letter/i/f07891/32.png) [@IMfez](https://boards.straightdope.com/u/IMfez)\ **Post date:** [September 7, 2014, 9:14am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/1 "2014-09-07T09:14:21Z")
Looking up the GDP per capita figures for South Asia, I see that Pakistan has a GDP per capita of $1,300, India $1,500, Bangladesh $850, Nepal $700. and then there’s Sri Lanka, with a GDP per capita of almost $3,300. Can somebody tell me why Sri Lanka is doing so well compared to the other South Asians? ---
**Author:** ![JKellyMap](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jkellymap/32/15880_2.png) [@JKellyMap](https://boards.straightdope.com/u/JKellyMap)\ **Post date:** [September 7, 2014, 11:03am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/2 "2014-09-07T11:03:08Z")
Mere smaller population than the others (which I assume it has, but didn’t check) might explain _some_ of this – not due to any Malthusian causality, but merely due to statistical chance (all other things being equal, which of course they never are, most countries have a raw number of wealthy within a certain range, and a raw number of middle class within another range, and then “the rest” are poor – the more populous the country, the bigger “the rest” is going to be). Even if this were a factor, it would only be a partial explanation. We await someone with more specific knowledge of this case. ---
**Author:** ![Isilder](https://avatars.discourse-cdn.com/v4/letter/i/cc9497/32.png) [@Isilder](https://boards.straightdope.com/u/Isilder)\ **Post date:** [September 7, 2014, 11:16am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/3 "2014-09-07T11:16:22Z")
> [@IMfez](#): > > Looking up the GDP per capita figures for South Asia, I see that Pakistan has a GDP per capita of $1,300, India $1,500, Bangladesh $850, Nepal $700. and then there’s Sri Lanka, with a GDP per capita of almost $3,300. > > Can somebody tell me why Sri Lanka is doing so well compared to the other South Asians? It has a small population, but produces 23% of the worlds tea leaves. In fact Ceylon tea is desired…Ceylon is now called Sri Lanka… The country has very little other exports… 2nd highest export is clothing at 10% of the value of the tea . ---
**Author:** ![N9IWP](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/n9iwp/32/3154_2.png) [@N9IWP](https://boards.straightdope.com/u/N9IWP)\ **Post date:** [September 7, 2014, 12:07pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/4 "2014-09-07T12:07:31Z")
There is a small enough population that Arthur C Clarke’s estate distorts the average 🙂 Brian ---
**Author:** ![Mighty\_Mouse](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mighty_mouse/32/7776_2.png) [@Mighty\_Mouse](https://boards.straightdope.com/u/Mighty_Mouse)\ **Post date:** [September 7, 2014, 12:37pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/5 "2014-09-07T12:37:18Z")
They have one of the highest literacy rates in Asia, and generally have a decent school system for the overwhelming majority of the population. I don’t know where Islider is getting his/her numbers from but Sri Lanka’s biggest export by far is textiles. Tea is a distant second. ---
**Author:** ![elbows](https://avatars.discourse-cdn.com/v4/letter/e/b3f665/32.png) [@elbows](https://boards.straightdope.com/u/elbows)\ **Post date:** [September 7, 2014, 12:57pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/6 "2014-09-07T12:57:18Z")
(I cannot recommend highly enough that if interested you seek out a history of Sri Lanka, it’s an amazing read, truly.) ---
**Author:** ![Askance](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/askance/32/8281_2.png) [@Askance](https://boards.straightdope.com/u/Askance)\ **Post date:** [September 8, 2014, 2:50am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/7 "2014-09-08T02:50:28Z")
It’s serendipity. ---
**Author:** ![Hector\_St\_Clare](https://avatars.discourse-cdn.com/v4/letter/h/b5ac83/32.png) [@Hector\_St\_Clare](https://boards.straightdope.com/u/Hector_St_Clare)\ **Post date:** [September 8, 2014, 3:15am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/8 "2014-09-08T03:15:56Z")
> [@IMfez](#): > > Looking up the GDP per capita figures for South Asia, I see that Pakistan has a GDP per capita of $1,300, India $1,500, Bangladesh $850, Nepal $700. and then there’s Sri Lanka, with a GDP per capita of almost $3,300. > > Can somebody tell me why Sri Lanka is doing so well compared to the other South Asians? I prefer HDI as a method for comparing general ‘doing well’ across countries. By the HDI measure, the gap is a little smaller, but Sri Lanka is still _well_ above India (it’s roughly in between Mexico and Brazil, while India is below the poorest countries in Latin America, if that gives you a sense). I don’t really know why that might be. (Sri Lanka is above all individual _states_ in India except Kerala and Delhi as well). ---
**Author:** ![Cunctator](https://avatars.discourse-cdn.com/v4/letter/c/43a26b/32.png) [@Cunctator](https://boards.straightdope.com/u/Cunctator)\ **Post date:** [September 8, 2014, 3:36am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/9 "2014-09-08T03:36:07Z")
> [@Askance](#): > > It’s serendipity. All three princes are smiling. ---
**Author:** ![EdwinAmi](https://avatars.discourse-cdn.com/v4/letter/e/5fc32e/32.png) [@EdwinAmi](https://boards.straightdope.com/u/EdwinAmi)\ **Post date:** [September 8, 2014, 3:49am UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/10 "2014-09-08T03:49:58Z")
I’d say ditto to the above about the tea production, but expand that into rich natural resources all over, especially agriculture. And I’d combine that with, unfortunately, the recent, long war. Usually when a lot of the populace dies the survivors do better due to less competition in the labor market and less demand for purchased good (wwages raise and prices of goods drop). Just a guess ---
**Author:** ![ftg](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ftg/32/2801_2.png) [@ftg](https://boards.straightdope.com/u/ftg)\ **Post date:** [September 8, 2014, 1:55pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/11 "2014-09-08T13:55:29Z")
> [@EdwinAmi](#): > > And I’d combine that with, unfortunately, the recent, long war. Usually when a lot of the populace dies the survivors do better due to less competition in the labor market and less demand for purchased good (wwages raise and prices of goods drop). > Just a guess The upper estimate of the number killed in the civil war is 100,000 out of a (current) population of 20M. That’s not enough to result in a significant economic shift. Especially given that most of the killed were quite poor, landless, etc. Having a lot of hard currency flowing in does miracles for an economy. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [September 8, 2014, 3:07pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/12 "2014-09-08T15:07:03Z")
> [@Isilder](#): > > In fact Ceylon tea is desired…Ceylon is now called Sri Lanka… Are you posting from 1973? ---
**Author:** ![yabob](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/yabob/32/2821_2.png) [@yabob](https://boards.straightdope.com/u/yabob)\ **Post date:** [September 8, 2014, 3:22pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/13 "2014-09-08T15:22:50Z")
> [@N9IWP](#): > > There is a small enough population that Arthur C Clarke’s estate distorts the average 🙂 > > Brian Actually, that’s close to a real factor. Sri Lanka is popular as a retirement haven. There’s a fair number of affluent retirees living there. ---
**Author:** ![Duckster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/duckster/32/1244_2.png) [@Duckster](https://boards.straightdope.com/u/Duckster)\ **Post date:** [September 8, 2014, 3:43pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/14 "2014-09-08T15:43:25Z")
The GDP (per capita) is $6,500 (2013 est.) [according to the CIA](https://www.cia.gov/library/publications/the-world-factbook/geos/ce.html). ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [September 8, 2014, 3:56pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/15 "2014-09-08T15:56:47Z")
This is pure speculation, but might turn out to be informative if factual. The other countries mentioned have very high birth rates. Which means the capita denominator is full of teens and younger folks who contribute zero to the GDP numerator. IF Sri Lanka has a relatively lower birth rate and hence relatively fewer pre-working age citizens, that could be a large part of the difference. Civil war such as they’ve experienced for the last 10-15 years is hard on both the numerator & denominator, but given the details of that particular conflict, would probably suppress the denominator more than the numerator. As well, ISTR that in India there is a large difference in birth rate between the Hindu & Muslim populations, with the Muslim side being the more child-productive. Pakistan is of course very heavily Muslim. Sri Lanka is 70% Buddhist, 13% Hindu, and 10% Muslim. So that difference in religious makeup may also be a factor in average family size. ---
**Author:** ![Lemur866](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lemur866/32/434_2.png) [@Lemur866](https://boards.straightdope.com/u/Lemur866)\ **Post date:** [September 8, 2014, 4:14pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/16 "2014-09-08T16:14:12Z")
If you look at which American states have the highest rates of particular cancers and which have the lowest rates, it turns out that small population states always have the lowest and highest rates. This means that the smaller a population is, the more likely it is to diverge from the mean. There are parts of India that are as wealthy as Sri Lanka, and parts that are poorer. If India was broken into a dozen countries some of those countries would be richer than India is now, and some would be poorer. If Sri Lanka was annexed by India it would barely change the average wealth on India, because India has a billion people. ---
**Author:** ![yabob](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/yabob/32/2821_2.png) [@yabob](https://boards.straightdope.com/u/yabob)\ **Post date:** [September 8, 2014, 4:19pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/17 "2014-09-08T16:19:20Z")
> [@LSLGuy](#): > > … > > The other countries mentioned have very high birth rates. Which means the capita denominator is full of teens and younger folks who contribute zero to the GDP numerator. > > … I was just looking at that. Sri Lanka: 0-14 years: 24.7% (male 2,758,360/female 2,648,073) 15-24 years: 14.9% (male 1,651,901/female 1,606,465) 25-54 years: 42.1% (male 4,504,395/female 4,708,288) 55-64 years: 9.5% (male 966,295/female 1,117,310) 65 years and over: 8.7% (male 812,669/female 1,092,689) (2014 est.) India: 0-14 years: 28.5% (male 187,016,401/female 165,048,695) 15-24 years: 18.1% (male 118,696,540/female 105,342,764) 25-54 years: 40.6% (male 258,202,535/female 243,293,143) 55-64 years: 7% (male 43,625,668/female 43,175,111) 65 years and over: 5.7% (male 34,133,175/female 37,810,599) (2014 est.) Bangladesh: 0-14 years: 32.3% (male 27,268,560/female 26,468,883) 15-24 years: 18.8% (male 14,637,526/female 16,630,766) 25-54 years: 38% (male 29,853,531/female 33,266,733) 55-64 years: 5.9% (male 4,964,130/female 4,870,447) 65 years and over: 5% (male 4,082,544/female 4,237,592) (2014 est.) Sri Lanka does have a much older population. And some of that larger over 55 crowd will be those western retirees I was mentioning. Some guy worth a couple million intent on spending his “golden years” in a “tropical paradise” has to skew the GDP a bit. It isn’t the entire reason, but I suspect it’s a contributing factor. Sri Lanka is one country that offers an attractive retirement visa: [http://www.retiretosrilanka.net/visa](http://www.retiretosrilanka.net/visa) ---
**Author:** ![Hector\_St\_Clare](https://avatars.discourse-cdn.com/v4/letter/h/b5ac83/32.png) [@Hector\_St\_Clare](https://boards.straightdope.com/u/Hector_St_Clare)\ **Post date:** [September 8, 2014, 8:16pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/18 "2014-09-08T20:16:51Z")
> [@LSLGuy](#): > > This is pure speculation, but might turn out to be informative if factual. > > The other countries mentioned have very high birth rates. Which means the capita denominator is full of teens and younger folks who contribute zero to the GDP numerator. > > IF Sri Lanka has a relatively lower birth rate and hence relatively fewer pre-working age citizens, that could be a large part of the difference. Civil war such as they’ve experienced for the last 10-15 years is hard on both the numerator & denominator, but given the details of that particular conflict, would probably suppress the denominator more than the numerator. > > As well, ISTR that in India there is a large difference in birth rate between the Hindu & Muslim populations, with the Muslim side being the more child-productive. Pakistan is of course very heavily Muslim. Sri Lanka is 70% Buddhist, 13% Hindu, and 10% Muslim. So that difference in religious makeup may also be a factor in average family size. Eh. Fertility rate (which is a more useful variable than birth rate, IMO) is no longer that high in India or Bangladesh. It’s actually lower in Bangladesh than in India, which suggests that religion per se isn’t the important variable (on a cross-national level it’s much more likely to be related to differences in women’s education). Fertility rate is 2.7 in India, 2.3 in Sri Lanka (I sort of doubt both numbers, especially India 's, but even if the India TFR is somewhat an underestimate, I doubt it’s _that_ much higher). ---
**Author:** ![Lamar\_Mundane](https://avatars.discourse-cdn.com/v4/letter/l/85f322/32.png) [@Lamar\_Mundane](https://boards.straightdope.com/u/Lamar_Mundane)\ **Post date:** [September 8, 2014, 10:32pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/19 "2014-09-08T22:32:14Z")
Isn’t Sri Lanka also a growing tourist destination? And not of the kind where tourists spend all their time and money in a walled-off resort on the beach, but where tourists travel to the inland parks for wildlife and nature viewing, injecting at least some money into the local economies? ---
**Author:** ![Jim\_s\_Son](https://avatars.discourse-cdn.com/v4/letter/j/e19adc/32.png) [@Jim\_s\_Son](https://boards.straightdope.com/u/Jim_s_Son)\ **Post date:** [September 8, 2014, 11:56pm UTC](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741/20 "2014-09-08T23:56:38Z")
They rank better on the Heritage Foundation than the other countries the OP listed. 90th overall is not real good but better than its neighbors. > **[Sri Lanka Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption](https://www.heritage.org/index/country/srilanka)** > > Learn more about the Sri Lanka economy, including the population of Sri Lanka, GDP, facts, trade, business, inflation and other data and analysis on its economy from the Index of Economic Freedom published by The Heritage Foundation. [Next page](https://boards.straightdope.com/t/why-is-sri-lanka-relatively-wealthy-for-its-area/697741.md?page=2)