Question

How does an economist compare the standard of living in two different countries

Answer 1

In order for an economist to compare the living standard in two different countries, he/she will need to take multiple parameters in consideration and compare all of them individually, after them sum them up and make the final conclusion.

One of the things is the GDP nominal of the countries, which shows how strong the economy of the country is, and in which direction it is moving. Then the GDP per capita, which will reflect how much actually the citizens earn on average. The prices of the goods and services in the countries come as next, and their prices are then compared with how much the GDP per capita, so that the economist can see what is the economic power of the citizens. The availability and quality of the institutions of the countries, the infrastructure, corruption rate, freedom of speech, will all be examined in order to determine the living conditions that are available to the people. So once all of these things are examined and summed up, the economist will be able to make a proper comparison of the standard of living in the two countries.

Answer 2

Answer: by comparing real GDP per capital

Explanation: GRADPOINT