Unit 2: Measuring living standards

GDP per capita is the traditional measure of living standards in an economy - it is a useful tool of comparison but it has its limitations:

•Inequalities = distribution of income

•Hidden economy

•Ignores externalities

•Population sizes

•Political environment

•The human cost – the number of hours worked

•Production does not = consumption

There are several other measures of living standards that we can use to give us an ide
about life inside a country. Life expectancy  birth rate and death rate are all interesting as
is the literacy rate. Some people use the number of mobile phones per person as an
indicator of living standards. 

Your task is to research the following measures of living standard and explain why they 
may give a more accurate picture of living standards and why they may not!

• Life expectancy 
• Infant mortality rate
• Literacy rate
• HDI
• OECD's better life index
• Inclusive wealth index