Changes in Standard of Living in the US economy

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Concept

The concept of the standard of living, apart from the possession of goods, also includes the dimensions of livelihood that can not be afforded by the person or simply not available, e.g., services offered by the state and the quality of the ecology.

The methods to measure the standard of living is a bone of discord between the social-scientists, and, when it comes to compare the standard of living for different countries per capita incomes are considered to reflect the real condition, but, again, per capita consumption of services and goods is taken to be the right indicator by some researchers.

Nonetheless, both, per capita income and per capita consumption to find out the real standard of income, used by the economists, can be ambiguous for important economic and social evils. Moreover, the figures for the level of income do not show availability of safe drinking water, right to contest in elections, and wealth that is considered income.

Per Capita income in USA

When seen from the perspective of per-capita income the United States of America is grouped among the countries with highest-levels since the eighteenth century, but, the reality is somewhat different and complex than it seems.

The slavery prevalent in the early America was responsible for high-levels of income and thereby the standard of living for its natives, but, the standard of living of the slaves, with a few variations, remained low. Migrants from many places in expectations of a good-quality of life there got disappointed when they reached America; however, simply survival for a family was not a grave concern.

But, anyway, its population has enjoyed a higher standard of living when compared to many other countries. From middle 1800s to, almost, the middle of 1900s, the US economy per capita income saw a seven-time increase, without too much control in the level of prices which means the real increase in income was less than the nominal while facing a few business-cycles.

Regional Disparities and Income distributions

The standard of living in different regions of America differed widely. The Southern and Mid-West part of America has a lower level of income than the people living in the North-East and far West. The South and Mid-West population of America is mainly comprised of farmers, with low incomes.

The difference in the level of income in diverse regions dramatically reduced after increasing in the middle and the end of the nineteenth century. The industrial development in the South and Midwest, and the comparative boost in the agricultural-income are mainly responsible for the above increase in income levels. The distribution of income in the US economy has been roughly par with Europe as per the available data.

The richest people, around five-percent, had a part of around eighty percent in the national income as compared to twenty-percent acquired by the rest ninety-five percent, before the Civil War. The 1920s saw an improvement in equality in comparison to the earlier periods.

The statistics changed to fifty-fifty for the same five percent and ninety-five percent in 1950s. The distribution of income remained more or less same till the mid of 1970. After that income inequality rose and the labor-class saw a decline in the standard of living. During Regan’s period (1980-88) inequality increased further due to weak labor-laws and since then it is on the rise and has been the central theme of economic discussions.

 

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