Question

EXPALIN WITH EXAMPLES IF LOW LEVELS OF LIVING CAN EXIST SIMULTANEOUSLY WITH HIGH LEVELS OF PER CAPITA INCOME

Answer 1

The problem with the measures of well being exists not only statistically but also theoretically. In theory, the usual measure of per-capita income is found to be inefficient via several welfare economists, who prefers indexes like HDI, adjusts to income inequality, etc. The arguement against the measure - per-capita income, goes as that any average is not supposed to reflect the disparity, or variance within the data. For example, for two nation with two people, while one nation's people earning $50 and $50, will have a per capita income of $50, with no income inequality, but if the other nation's people earn $10 and $90, they will also have the per-capita income of $50, with high income inequality. In real world however, yet the measure of per-capita income mildly correlates with the income disparity, there are more exceptions in practice than theory.

In US, a country with high percapita income, the gini coefficient goes from about 40 to 45, where gini coefficient is a measure of income inequality for 0 meaning absolutely equal and 100 meaning absolutely unequal. With about the same interval of gini coefficient, Argentina is also a nation having, yet not that high, but an upper slot of per-capita income. Australia and New-Zealand also have quite high per-capita income, but their gini coefficient goes from about 35 to 40. Russia, with same slot of per-capita income as of Argentina, have income inequality comparable to the US.

The main thing to consider is that, in theory average doesn't reflect the vriance and lowerer measures might (and does) exists more along with a less higher measures, and still the per-capita measure will be on higher slot as the higer measures are much higher than the lower.