Standard of Living

Standard of Living

What it means

Standard of living describes the material well‑being of individuals or populations, focusing on access to necessities such as income, housing, food, healthcare and education. It’s a measure of wealth, consumption and comfort — essentially how much a population can afford and the goods and services available to it.

How it’s measured

Economists and organizations use several indicators to estimate standard of living. Common measures include:
* Per capita GDP or GNI (quick, widely used proxy for available goods and services per person)
* Life expectancy and health outcomes
* Educational attainment (e.g., expected years of schooling)
* Income per capita adjusted for purchasing power
* Access to infrastructure and technology (e.g., internet use)
* Employment levels and economic opportunity

Composite indices combine these indicators to give a broader picture. The United Nations’ Human Development Index (HDI) is a prominent example, integrating life expectancy, education and income per capita into a single score.

Examples (HDI)

The HDI ranks countries on human development using life expectancy, education and income per person. Example 2019 values:
* Highest HDI scores: Norway (0.957), Ireland & Switzerland (0.955), Hong Kong & Iceland (0.949), Germany (0.947).
* Lowest HDI scores: Niger (0.394), Central African Republic (0.397), Chad (0.398), Burundi & South Sudan (0.433), Mali (0.434).
* United States (2019): 0.926 (ranked #17), life expectancy 78.9 years, 16.3 expected years of schooling, GNI per capita $63,826.
* Norway (2019): HDI 0.957, life expectancy 82.4 years, 18.1 expected years of schooling, GNI per capita $66,494 (PPP), internet use ~96.5%.
* Niger (2019): HDI 0.394, life expectancy 62.4 years, 6.5 expected years of schooling, GNI per capita $1,201 (PPP), internet use ~5.3%.

These contrasts illustrate how differences in health, education and income translate into very different standards of living.

Context and trends

• Per capita GDP is a common, rough proxy for standard of living; more sophisticated measures add health and education.
• Standards of living are typically higher in developed countries and tend to rise in emerging markets as economies industrialize and incomes grow.
• Over the past century many countries have improved standards of living: increased life expectancy, wider availability of once‑luxury goods, and generally fewer hours worked for similar output.

Standard of living vs. quality of life

While related, the two concepts differ:
* Standard of living: objective, material conditions (income, housing, food, healthcare, education).
* Quality of life: broader and more subjective, including environmental quality, personal and political freedoms, safety, cultural factors and overall life satisfaction.

A high standard of living does not automatically imply a high quality of life for every person, since subjective and non material factors play a major role in well‑being.

Key takeaways

• Standard of living measures material well‑being and access to necessities.
• Per capita GDP is a common proxy, but composite indices like the HDI provide a fuller picture by including health and education.
• Differences between countries can be large; improving standard of living typically involves gains in income, health and education.
• Quality of life overlaps with but extends beyond material measures to include subjective and non‑material factors.

Sources

• United Nations Development Programme — Human Development Index and country profiles
• Our World in Data — Working Hours and related historical data
• Economic History Association — History of standard of living studies