Perceptions of Society’s Necessary Standard of Living: Are Perceptions Determined by What People Have, or Do They Reflect a Social Consensus?

Analyses of material deprivation usually use lists of goods and activities to assess an individual’s possessions and to compare it with the society’s standard of living. If the number of possessions falls below a certain threshold, the individual is assumed to be materially deprived. Also state-guaranteed minimum income payments are often based on a basket of goods, which are assumed to represent a minimal living standard in the respective society. However, this approach rests on the assumption that a social consensus exists about what constitutes society’s necessary standard of living, which has never been tested in a theoretically and methodologically sound way. Our paper provides a model of the main determinants of standard of living perceptions in the public, develops a measurement model for a survey of necessary items, and tests whether these perceptions are expressions of a consensual normative standard or reflections of the respondent’s idiosyncratic individual living situation. We have used two waves of the GESIS Panel in 2016 to survey the current opinions about the necessary standard of living in the German population. Estimating cross-lagged auto-correlated structural equation models, we find that necessity evaluations are quite homogeneous across social groups but are influenced by individuals’ possessions, which vary within society and hence, challenge the social consensus assumption. Moreover, instead of using only the most necessary items, survey instruments should include both necessary and less necessary items to reflect the whole distribution of possible standard of living perceptions. Our results further suggest that analyses using single items should be avoided due to possible measurement errors.