My contribution to the intelletually challenged individuals
trying to participate in a discussion here without knowing the
definition. 
Standard of living is generally measured by
standards such as real (i.e. inflation adjusted) income per person
and poverty
rate. Other measures such as access and quality of
health care, income
growth inequality and educational standards are also
used. Examples are access to certain goods (such as number of
refrigerators per 1000 people), or measures of health such as life
expectancy. It is the ease by which people living in a time or
place are able to satisfy their wants.
The idea of a 'standard' may be contrasted with the quality of
life, which takes into account not only the material
standard of living, but also other more intangible aspects that
make up human life, such as leisure, safety, cultural resources,
social life, physical
health, environmental quality issues etc. More complex
means of measuring well-being must be employed to make such
judgments, and these are very often political, thus controversial.
Even between two nations or societies that have similar material
standards of living, quality of life factors may in fact make one
of these places more attractive to a given individual or group.
However, there can be problems even with just using numerical
averages to compare material standards of living, as opposed to,
for instance, a Pareto
index (a measure of the breadth of income or wealth
distribution). Standards of living are perhaps inherently
subjective. As an example, countries with a very small, very rich
upper class and a very large, very poor lower class may have a high
mean level of income, even though the
majority of people have a low "standard of living". This mirrors
the problem of poverty
measurement, which also tends towards the relative. This
illustrates how distribution of income can disguise the actual
standard of living.
Likewise Country A, a perfectly socialist country with a
planned
economy with very low average per capita income would
receive a higher score for having lower income inequality than
Country B with a higher income inequality, even if the bottom of
Country B's population distribution had a higher per capita income
than Country A. Real examples of this include former East
Germany compared to former West Germany or North Korea compared to South Korea. In each case, the
socialist country has a low income discrepancy (and therefore would
score high in that regard), but lower per capita incomes than a
large majority of their neighboring counterpart. This can be
avoided by using the measure of income at various percentiles of
the population rather than a highly relative and controversial
overall income inequality measure.
A Standard of Living Index has been published
annually since 1980 by International Living. As at 31
December 2009 this showed 1 France, 2 Australia, 3 Switzerland, 4
Germany, 5 New Zealand, 6 Luxembourg, 7 USA, 8 Belgium, 9 Canada,
10 Italy, 25 UK, 47 Israel, 194 Somalia.[1][2]
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