GDP per capita is not a useful measure of living standards. Or most other things, really; it’s a very crude metric.
To take an over-simplistic example, imagine that the cost of healthcare in Mississippi just rose 5k per capita. Mississippi’s GDP just rose 5k per capita (simplified almost to the point of being nonsensical, but increased healthcare cost will raise gdp), but Mississippians got worse off!
For a glaring example, take Ireland; gdp per capita is over 3x Spain. Is the standard of living in Ireland 3x that of Spain? Definitely not; I think you could actually make a case for it being lower, especially for the more economically disadvantaged (wages are much higher, but so is cost of living).
I think where all this comes from is that gdp/capita _used_ to work a bit better as a proxy for standard of living (though still not well) when economies were more manufacturing-oriented.
Nice example. I actually moved from Ireland to Spain a few years ago.
Indeed my wage went down but my standard of living went up. The exception being if I want to pay goods that cost the same everywhere (e.g. computers, cars). But it's not a big deal.
Also, my quality of life increased considerably. In Ireland public transport is horrible and almost nonexistent. A car is always necessary for those living outside of Dublin or Cork. Now I can do without a car and spend 20 euro monthly on all my travel needs, and not having the hassle and costs of a car. Driving is very stressful to me (especially in Ireland where until recently people could just buy their license at the post office so driver skills are very low).
And the weather is way better which affected me greatly in Ireland (during winter it was raining almost every day where I lived, and the days were super short leading to depression). Here in Spain life is much more outdoors. And healthcare here is free and much better (in Ireland even though I had expensive private insurance I still had to pay 70 euro just to see the family doctor. Here I pay nothing).
To take an over-simplistic example, imagine that the cost of healthcare in Mississippi just rose 5k per capita. Mississippi’s GDP just rose 5k per capita (simplified almost to the point of being nonsensical, but increased healthcare cost will raise gdp), but Mississippians got worse off!
For a glaring example, take Ireland; gdp per capita is over 3x Spain. Is the standard of living in Ireland 3x that of Spain? Definitely not; I think you could actually make a case for it being lower, especially for the more economically disadvantaged (wages are much higher, but so is cost of living).
I think where all this comes from is that gdp/capita _used_ to work a bit better as a proxy for standard of living (though still not well) when economies were more manufacturing-oriented.