The Human Development Index or HDI is a statistic composite used to measure the overall achievement of a country based on its social and economic dimensions. Pakistani economist Mahbub ul Haq spearheaded the development of this index while working as a Special Adviser to the United National Development Programme Administrator William Henry Draper alongside the introduction of the Human Development Report in 1990.
Note that the primary purpose of HDI is to provide a simple composite measure of human development to convince the public, policymakers and government leaders, and academicians that the level of development of a particular country should be measured not only by economic indicators but also by improvements in human well-being. Nonetheless, there are three indicators of HDI: life expectancy, education, and per capita income indicators.
Defining the Three Indicators of Human Development Index
Measuring human development in a particular country requires assessing the three indicators mentioned above. The United Nations also consider these indicators as the basic dimensions of human development across countries. The following are further details:
• Life Expectancy: A statistical measure of the average time an individual is expected to live, based on the year of its birth, current age, and other demographic factors such as gender. The HDI particularly measures life expectancy at birth and evaluates further the citizens based on living long and healthy lives.
• Education: A statistical measure based on the mean years of schooling and expected years of schooling. The purpose of this indicator or the reason why it has been included in HDI stems from the fact that knowledge transfer and accumulation play a role not only in socioeconomic development but also in human well-being.
• GNI Per Capita: A gross national income or GNI per capita income is the total amount of money earned by individuals and businesses in a particular country divided by mid-year population. This specific indicator allows evaluators to understand whether or not the citizens of a country have a decent standard of living.
Arguments for and Criticisms of the Human Development Concept
The UNDP argues that economic indicators and monetary measures such as GDP per capita, employment level, and economic growth rate, among others, are inadequate proxies of development. The human development approach is about expanding the richness and achievements of human life and the society, rather than the abundance of the economy.
Mahbub ul Haq framed the human development concept in terms of whether people are able to “be” and “do” desirable things in life. The UNDP further highlights the centrality of people, as well as the opportunities and choices available to them. Essentially, when people in a particular society are healthier, have substantial educational attainment, and have a normal standard of living, they can become more and do more.
However, the human development concept and the overall human development index have several criticisms. A 2011 study by H. Wolf, H. Chong, and M. Auffhammer revealed sources of data errors that result in misclassifications. These errors stem from data updating, formula revision, thresholds used to classify the development status of a country.
A dated critique by O. H. Chowdhury noted that objectivity remains a challenge in any index. With regard to HDI, his study explained that this statistical composite combines the qualitative and quantitative dimensions of the three HDI indicators. The assignment of weights is also problematic. For example, weights assigned to certain factors that are common in developed countries may not be indicative of a higher level of development or human well-being. Chowdhury that countries should be ranked first according to their level of economic development in order to measure their achievements in human development.
There are also criticisms regarding the inclusion of education in HDI. Note that although higher educational attainment within a population can provide economic opportunities, it may not be an absolute indicator of prosperity. Countries with high GDI per capita and long life expectancy would have HDI scores if their overall educational attainment levels were low. The indicators are not equally valuable according to some critics.
Other critics point to the fact that the HDI lacks considerable attention to other factors or indicators of human development and wellbeing. These include access to necessities such as water, healthcare, and an efficient transportation system, among others, that are more indicative of a better standard of living. Because of technological developments, access to technology has also been considered an essential facet of modern living.
FURTHER READINGS AND REFERENCES
- Chowdhury, O. H. 1991. “Human Development Index: A Critique.” Bangladesh Developmental Study. 19(3): 125-127
- Stanton, E. A. 2007. “The Human Development Index: A History.” PERI Working Papers: 14-15. Political Economy Research Institute. Available via PDF
- United Nations Development Programme. n.d. “About Human Development.” United Nations Development Programme. Available online
- Wolf, H., Chong, H., & Auffhammer, M. 2011. “Classification, Detection, and Consequences of Data Error: Evidence from the Human Development Index.” Economic Journal. 121(553): 843-970. DOI: 1111/j.1468-0297.2010.02408.x