Here are the key points explaining why average income is an important criterion for development:

1. Indicator of Living Standards: Average income indicates the average earnings per person in a country, providing insight into the standard of living.

2. Economic Growth: A rise in average income reflects economic growth, suggesting increased production and more wealth creation within the nation.

3. Human Development: Higher average income allows for investments in education, healthcare, and infrastructure, improving overall human development indices.

4. Poverty Reduction: Increased average income levels contribute to poverty alleviation by enabling access to essential goods and services.

5. Market Dynamics: Higher average incomes boost consumer spending, stimulating economic activity, and encouraging investments.

6. Global Competitiveness: Nations with higher average incomes are often more competitive globally, attracting investments and skilled labor.

Understanding average income helps assess a country’s economic progress and the well-being of its citizens, serving as a vital factor in measuring development and prosperity.