Comparing Standards of Living

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Comparing Standards of Living

  1. How would you compare the standard of living in the UK with that in the Soviet Union and Ethiopia?

To really answer this question you have to understand what the standard of living means. I think it means a way of measuring the quality of life, usually in monetary terms. The problem with this is that some things are very hard to value in this way as it is hard to actually put a monetary value on the item. E.g. The value of having a father in a family, the value of education of a person and the value of having two married parents.

The way to compare all these things is to get the figures for each country like divorce rate, number of single parents, GNP, average air quality, the number of people per doctor, etc, etc.

To do this properly then you will have to decide how important each item is to the quality of life of a person. An example of this would be Gross National Product per capita. This is probably one of the most important as if people earn more they can buy more goods with the money and this will help them enjoy life a bit more. Then you can find the Gross National Product per Capita but if you are comparing two countries together the currencies will be different. Even if you use the exchange rate to change the values they will still be hard to compare as the exchange rate is always changing. Not only that but the price of goods is always changing between countries. If in France a bag of teabags was £2 and in the UK they might be £3. This leaves a problem because someone over here might get paid more put they have to spend more on essential goods such as food. They way to get round this difference is to get the average price of a typical bag of shopping on one particular day of the year. This will entail hundreds of people going out and finding the price of 500 different goods like Nescafe coffee and Walls ice cream. Then they will average these up over the whole country. These then can be used as an exchange rate as they can be compared to the price in francs or marks of the same basket in the other country.

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Even after you have done this all you have is a reasonably balanced way of finding Gross National Product per Capita. You still can’t compare all the other data available like air quality and divorce rate.

I would have to decide how they would be compared like the value of clean air and the value of having two parents that are not divorced. The importance of each of these has to be added up and put into a final number for the standard of life for that country.

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