Standard of Living: Definition & Measurement

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

Coming up next: Transfer Payment: Definition & Examples

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
Your next lesson will play in 10 seconds
  • 0:00 Standard of Living Defined
  • 0:28 General Factors
  • 1:00 Economic Factors
  • 2:04 Problems with Economic…
  • 3:18 Lesson Summary
Save Save Save

Want to watch this again later?

Log in or sign up to add this lesson to a Custom Course.

Log in or Sign up

Speed Speed

Recommended Lessons and Courses for You

Lesson Transcript
Instructor: Shawn Grimsley

Shawn has a masters of public administration, JD, and a BA in political science.

You've probably heard about the concept of standard of living and how it varies between different countries. In this lesson, you'll learn about what standard of living is and how it can be measured.

Standard of Living Defined

Standard of living can be thought of as a measure of the quality of life or level of material prosperity enjoyed by individuals, a specific demographic group, or a geographic region such as a country. In economics, the standard of living is usually used to determine the relative prosperity of the population of an entire country and is often compared to the standard of living that populations of other countries enjoy.

General Factors

Standard of living is a composite of different factors that are generally believed to enhance the quality of life of individuals in a population.

The following is a list of factors that are used to determine a country's standard of living:

  • Household income
  • General health of a population
  • Life expectancy of the members of a population
  • Availability and quality of housing
  • Level of crime
  • Access to health care
  • Access to education
  • Access to social services
  • Political freedom
  • Social freedom

Economic Factors

Determining a country's standard of living is really a complex art rather than an exact science because there are elements of it that are hard to quantify. For example, it is often presumed that living in a country with a democratic political system and a free press improves the standard of living, but this is not exactly easy to reduce to numbers. Consequently, economists typically try to simplify the measure by using only economic factors that are subject to measurement and mathematical calculation.

Economists often use per capita income as a measure of standard of living. Per capita income is simply the average amount of money earned per person in the country. Generally speaking, a higher per capita income allows people to buy more goods and services, increases access to education, and increases access to healthcare, all of which increases quality of life and life expectancy. Higher per capita income also means that a country has a higher tax base to support social services, infrastructure, public education, and other investments that can further improve the population's standard of living.

To unlock this lesson you must be a Member.
Create your account

Register to view this lesson

Are you a student or a teacher?

Unlock Your Education

See for yourself why 30 million people use

Become a member and start learning now.
Become a Member  Back
What teachers are saying about
Try it risk-free for 30 days

Earning College Credit

Did you know… We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Create an account to start this course today
Try it risk-free for 30 days!
Create an account