HUMAN DEVELOPMENT REPORT 1990HUMAN DEVELOPMENT REPORT 1990 Published a1: bat for the United Nations ) Development Programme (ul 10} NDP) NewYork Oxford Oxford University Press 1990Oslord Univrniy Press Osleed New York Tetons Delhi Borshay Calewnta Madras Karachi Peclag Joye Singapore Hong Kang Tokyo Nairobi Durcs Salaam Cape Town ‘Melbourne Auckland sand amsociated companies in ests Theda Consiga 1990 boy the Unites Nations Development Programme TUN Plans, New York, New Yedk, 10017, USA Onfond ins registered trademark of Oaford Univers Press [Alright reserved. No part ofthis publication muy be fependiced sired in a retrieval ster, oF ‘ranamied ian for oe by any rier, clectronc, mechanical photocopying, eeconing. ox ors, ‘wichout roe permission of Oxford University Press. Enc. ISHN0-19-506481. (paper! ISBN0-19.306480-1 cloth) Printing ilu digit 9 8 7694S Printed in the United States of Ansctica on acid free paper Eling desk ad poco managemernt: Hruce Row-Latscn and Eileen Hanlon, American Writing Corporstion, ‘Washington, D.C. rsa Geral Quins, Qsinn Information Design, Cabin john, MarylandForeword We live in stirring times. An irresistible wave of human freedom is sweeping across many lands, Not only political systems but ‘cconomic structuresure beginning change in countries where democratic forces had been long suppressed, People are begin. ning wotake charge of theirewn dest these countries, Unnecessary ste inter ventions are on the wane. These are all reminders of the triumph of the human pitt In the midst of these events, we are rediscovering theessential truththa people ‘must be at the centre ofall development ‘The purpose of development is 10 offer people more options, One oftheir options isaccesstoinceme—notasanendin itself but as a means to acquiring human well- hing. But there areather options.as well, including long life, knowledge, political freedom, personal security, community pur- ticipation and guaranteed human tights, People cannot he reduced to a single di- ‘mensionaseconarniccreatures. Whatmakes them and the study of the devclapment process fascinating isthe entire spectrum through which human capabilites are ex panded and utiised, UNDP has undertaken to producean annual report on the hiuman dimension of development. This Hmen evelopment Repor: 1990s the first such efor. The central message of this Hunan Developreut Report isthatwhile growth in national production (GDP) is absolutely necessary tomeet allesseatial human abjec- tives, what isimportantiste studyhow this growth translates —or fails totranstate— 1 human development in ‘Some societies have levels of human development at modest levelsofpercapita income, Other societies have failed votranslate their comparatively high income levels and rapid economic growthimiecommensuratelevelsof human development, What were the policies that ledto such results? Inthisline of enquiry ie promising seeds of a much better link be- tweeneconomicgrowthand human devel ‘opment, which isby nomeans automatic ‘Theorientationof this Reportispeacti- ‘caland pragmatic. Itaimsto analysecoun tryexperience to distill practicalinsights. Its purpose is neither to preach tor to recom ‘mend any particularmodclof develope: ths purpose isto make relevant experience railable ro all policymakers, ‘The Report is of a seminal nature, It makes a contribution to the definition, _measurementand policy analysivof human development. [tix the firs in a series of annual reports, ILopensthedebate, Subic quent reports will go into further detail regarding the planning, management and fi ancingof human development ‘The Report is accornpaanied by the hu rman development indicators, which as ‘semble all available social and humandata for each country in u comparable form, UNDP will undertake, slong with ether agencies, programme oFaction to compile ‘themissing country data andto improve the ‘existing statisticeso tharthesehuman devel= ‘apment indicators come to be used acer time asa standard reference for countryand sdobal analysis, ‘Thepreparation of thisReporthasbeen United Nations systemuide initiative, 1 ampersonallygratefulto all the specialised agencies andother organisations inthe UN system, including the World Bank and the IME jortheirwholehearced supportof the preparation of this Report, Qneof theinci- dental benefits of such collaborationbeen the emergence of a close intellectual network within the UN system which will also be helpful For future reports. ‘The Human Development Report 1990 hasbeen prepared bya team of UNDP staff and eminent outsideconsultants under the ‘overall guidance of Mahbub ul Hag, former Finanecand Planning Ministetof Pakistan, inhis capacity ax Special Adviser tome, The views expressed inthis Report arethose of the team and not necessarily shared by UNDP or its Governing Council or the New York ‘May 11990, member governments of UNDP. The es- sence of any much report must be itsinde- pendencesnd its intellectual integrity. Thope that this Report — and its annual sequels —will make a significant contribu: tion ta the development dialogue itt the 1990s and lead to a serious exploration of human development programming at the country level. UNDP stands ready to assist this processboth at the intellectual and op- -erationallevels wad—_ William H. Draper It ‘Administrator UNDPAcknowledgements ‘The preparitionofthe Report would have been impoxsiblewithout thevaluablecon- tributionsthatthe authors received from a lange numberof organisationsand indi- viduals Paricularthanks areduc tatheagen- let und offices of the United Nutions system, which provided generous ass tance, sharing their accumulated experi ence, studiesand statisticaldatawiththe Report team. Their assistance made it possible for the Report to bea genuine 'UN systemwide initiative, Special men- tion must be made of the collaboration of Habitat (United Nations Centre for ‘Human Settlements), inthe preparation of chapter 5. The other contributing UN system and affiliated organisations were FAO, IFAD, 1LO,UN Statistical Office and Population Division, UN' UNFPA, UNHCR, UNICEF, UNIDO, 'UNOV,UNRISD. UNSO, and the World Bunk. Further inputs were received from various UNDP offices, in particular UNDP's country offices, the Regional Bureaux, the Division for Worenin Development, the Division for Nongovernmental Organisationsandthe ‘Office of Project Services. Lan Steele as- sisted in editing the first draft of the Report. ‘The Report draws on the statistical data bases established by the UN Statis- tical Office and Population Division, the ‘World Bank, the IMF, and the OBCD, ‘These have been complemented, and in partupdated, by selected siatisticaldata collected from government sources by ‘UNDP countryoffices. ‘Many colleagues in the UNDP con- tributed to the evolution of the Report throughcommentsand observationson earlier drafts. Thanks are due to G, Arthur Brown, DenisBenn, Picrre-Claver ‘Damiba, Gary Davis, LaisGomez-Echev- err, Trevor Gordon-Somers,Michacl Gucovsky, Arthur Holcombe, Andrew}. Joseph, Uner Kirdar, Sarth Papineau, Jehan Raheem, Augusto Ramirez- ‘Ocampo, Elizabeth Reid, Sarah Timpson sand Gustavo Tore Secretarial and administrative sup- portfor the Repor's preparation waspra- vided by Linda Grahek, Gwen Halsey, Ida Simons, Odette TinvAung, CarolAbbreviations Eeonamic Conran for Europe Economic Conxraisioa for Latin America wad the Caribbean Exonomic and Social Camasssion fot Asa ana the Paci Statistical Office ofthe European Computes Fond und Agiculne Organization ofthe United Nations ‘General Agreement om Tarife and Trade {nvernational Fund fox Agnicutural Development International Labour Orpaniation Invernational Menesary Fara ‘Onpaniation foe Economic Co-operation and Development United Nutone Development Programme {Urated Nasions Educational, Scientific. and Cultural Organization ‘United Natians Fund for Population Activities (Office of the United Nations High Ganmmissoner for Refugees ‘United Nations Chidren's Fund United Nations Office at Vena United Nations Rescarch Inatinne fo Soxial Developenent Unites Nations Slane Sahelian Office United States Agency for Intemational Development ‘Wedd Food Counc ‘World Food Programme ‘World Health Ongacization Intemational Bank for Recoostnxction and Developenent (Workd BanContents Defining and measuring human development 9 Defining human development 10 Measuring human development 11 CHAPTER TWO Human development since 196017 Expanding human capabilities 19 Using human capabilities 26 Disparities and deprivation within nations 29 Reversibility of human development 33 De-formation of human development 36 CHAPTER THREE Economic growth and human development 42 Typology of country experience 42 Sustained human development 44 Disrupted human development 51 Missed opportunities for human development 56 CHAPTER FOUR Human development strategies for the 1990s 61 Policy measures for priority objectives 62 Appropriate strategies and sequencing 65 Policies for adjusting countries 65 Setting global targets for human development 67 National plans for human development 70 Financing human development 72 External environment for human development 78. Implementing human development strategies 81 Conclusions 83CHAPTER | A, Peoplearethe real wealth of anation. The basicabjective ofdevelopment istocreate anenablingenvironment forpople to en jor'long, healthy, and ereative lives, This may appear tobe a simple truth, But itis often facgosten in the immediate cancer theuccumulationof commoditiesund financial wealth, Texhnicalconsiderations of theameans toachieve human development —and the tase of statistical aggregates to measure rational income and its growth — have at mes obscured the fact that the petmary objective of development is to benefit people. ‘There are two reasans for this First, natinnalincomefigures, useful hough they are for many purposes, de not reveal thecompasition ofincome wethe realbene- ficiaries. Second, peoplcoftenvalueachieve> ‘ments thar do not show up at all, ar nox iunmediately, in higher ncasured income of growthfigures: betternutrition and health services, greater accesstoknowledge, more secure livelihoods, hetter working cordi- tions, security against crime ane physical ‘iolence.sitisfyingleisurchours, anda sense ‘of participating in the econosnie, cultural and political nctivitiesof their communities ‘Ofcourse, peaplealso want highcrincornes asone of their options, But income is not ‘thesum total of human life Defining and measuring human development Aristotleargued for secing"thedifier: cee berweena good political arrangement and alad one" in termeofits suecesscsand failures in facilitating people's abilitytolead “flourishing lives”. Hurnan beings as the real end of all activities was a recurring theme in the writings of most of the early philosophers, Emmanuel Kant observed: “So act as to treat humanity, whether in their own person or in that of any other. in only The same motivating concern can be found in the writings of theearlyleadersof ation in economics — William Perry, Gregory King, Francois Quesnay, Antoine Lavoisier and Joseph Lagrunge, the grandparentsof GNP and GDP. Itisabo clearin the aritings of the leading political economists — Adam Smith, David Ricard, Robert Malthus, Karl Marcand John Stuart ‘Mill Butexcessive preoccupation with GNP growth and national income accounts has obscured that powerful perspective, sup- planting a forus on ends by an obsession ‘with merely the means. Recent development experience has ‘onceagain underlined the need for paying Tame Thiswayoflookingat human develop: GNP par empta ard selected seal incieators ments not really new. Theicea that social si oz i sine rrangeasenesiman be judged oy theeizent fe " towhich they promote "human good” joes County Sato” oot aad back fein 10 Aristotle, He ali warned Miao Siw aan hr ewe se against judging societies merely by such Sani * 2 2 thabreriicoespedgiaih uicenisoughi: Contes wae s 3 ie not for themselves but desired usmeansto sather objectives, "Wealth is evidently not ran 2M She ° ma Pa the good we are secking for it ix merely, Ona" Sar 3 0 % useful and forthe sake ofsomethingelse,- _S2vatAvabia ae & = = NG ANDDAIEASURIN HMA EIEVEROPAENTHuma lopment is e proce: of enlarging peuple’: ¢ w pices close attention to the link between eco- nomic growth and human development — foravariety of reason. +) Munyfast-growingdeveloping countries are discoveringthat theirhighGNP gromh rates have failed to reduce the sociveco- nomic deprivationof substantial sections their population. + Evenindustrianations re realizing that high income is no protection against the rapid spread of such problems ax drugs, alcoholism, AIDS, homelessness, violence and the breakdown af family relations. + At the same time, some low-income countries have demonstrated thatitis pox: sible tauchieve high levelsof humandevel- opment if they akilfully use the available means toexpand basichumancapabilides, ‘+ Human development efforts in many developing countries have been severely ‘squeezed bythe economic crisisofthe 19803 and the ensuingadjustment programmes. Recent development experience isthus 1 powerfulrreminder that the expansion of surputand wealth isonlyameans. Theend ‘of developmentmust be human well-being Howto relate the meunstotheukimateend should ance againbecomethecentzal focus ‘of development analysisand planning. Hov-eanesanomic groveth be managed inthe interestof the people? What alterna tive policies and strategicsnced to be pur ie fa cate mae ter he Dees rn ‘must, therefore, bemearethanjusttheex- palo of income and wealth tis foe ‘mut be people NING AND MEASURING HUMAN DE sued if people, not commodities, are the principal focusof nationalattention? This Report addresses these issues, Defining human development Human developmentisa process of enlarg ingpeople'schoices. The mosteritical ones living. Additional choices include political freedom, guaranteed humanrightsund self respect — what Adam Smith called the ability to mix with others without being “ashamed toappearin publick” (box 1.1). Teissometimesstiggested that income is good proxy for all other human ehoices since access to income permits exercise of every ether option, Thisisonly partly rae fora varicty of reasons: + Incomeis ameans, not an end. 1 may bbe used for essential medicines or narcotic drugs. Well-being ofa society depends on the uses to which income is put, not on the levelof incomeitsel * Country experience demonstratessev ceralcasesof high levelsof human develop- ment at modest income levels and poor levelsof human developmentat fairly high income levels. + Present incomeof acountry may offer litle guidance to its future growth prow pects. [fithas alreadyinvestedin its people, its potential income may be much higher than what its current income level shows, andviceversa. ‘+ Multiplying human problems in many industcial, rich nations show that high in- comelevels, bythemselves, are noguaran- tee for human progress. ‘The simple truth is that there is no tnutomaticlink between income growth and human progress. The muin preoccupation of development analysisshouldbehow such a linksun be created and reinforced. ‘The term uma development here le- noteshoth the process of widening people's choices and the fevef oftheir achieved well- being. It ulso helps to distinguish clearly berween twosides of humandevelopment. (Oneistheformationof humancapabihities, suchasimprovedhealthorknowledge. The ‘other is the use that people make of theircquired capabilities, for work orleisure ‘This way of looking at development differs fromthe conventional approachesto economic growth, human capital forma: tion, human resource development, human welfareor basic human needs. Itis neces: sarytodelineatethese differences clearly10 avoid any confusion: + GNP growth is treated here as being necessary but not sufticient for human development. Human progressrsay be lack. ing in some societies despite rapid GNP growth or high per capita income levels uunlesssomeadditional stepearetaken, * ‘Theories of human capital formation and human resource development view human beings primarily as means rather thanas ends, ‘They are concerned only with the supplyaide — with human beings asin struments for furthering commodity pro- duction. True, there is a connection, for human beings ure the aexive agents of all production. But human heings are more than capital goods forcommodity produc: tion. They are also the ultimate ends ancl beneficiaries of this process. Thus, the con- ceptofhumancapital formation (orhurnan resource development) captures only ane side of human development, not ity whole + Human welfare approsches look at human beings: more asthe bene! the development process than pants in it, They emphasise distributive policiesnatherthan production structures. + Thebusic needsapproach usually com centrates on the bundle of goods and ser- \icesthat deprived population groups need: food, helter, clothing, healthcareand water, It focuses on the provision of these goods and services rather than on the issue of human choices Hhimandevelopmient bycontrast brings togetherthe productionand distribution commoditiesand the expansion anduseaf human capabilities. It also focusses om choices —on what people should have, be and do to be able to ensure their own livelihood, Human developmentis, more> over, concemed not only with basic needs satisfaction but also with human develop. ‘meni asa participatory and dynamic peo: css. Itapplics equally olessdeveloped and highly developed countries Human developmentas defined in this Report thus embraces many of the earlier approaches to human development. This broad definition makes it possiblc tocap- ture better thecomplexity of humanlife— the many concerns people have and the ‘anyeultural, economic, ecial and politi caldifferencesi people's lives throughout theworld, ‘The broad definition also raises some uestions: Does humandevelopmentlend itself to measurement and quantification? Ts it opezational? Can it be planned and monitered? Measuring human development {An any system formeasuring and monitoring human development,the ideal would be to include many variables, to obtain as com- prehensive a picture as possible. But the currentlackof relevant comparable statis ticeprecludesthat, Norissuchcomprehen- sivenessentirely desirable, Too many indi- ators could produce a perplexing picture —perhaps distracting policymakers from the main overall trends, The crucial issue therefore isofemphasis, Thekey indicators ‘ThisReport suggests that the measurement ‘of human developeent should forthe timeIheing focus on the three exsential elements ‘af hurnar. life — longevity knowledge and decent living standards. For the frst exponent — longevity — lifeexpectancyat binh is theindientor. The importance of life expectancy lies in the ‘common belief that along life i valuable in itself and in the fact that various indirect ‘henefite (such as adequate nutrition and pod health) are closely associated with higher life expectancy. This association males life expectancy an important indica: tor of human development, especially in ‘view of the present lack of comprehensive information about people's health and nu- tetiomal status tbox 1.2), For the second key component — knowledge — Fiteracy figures ire only a crude reflection of access to education, Particularly tothe god quatityeduestion so nevessary for productive life in. modem society. But literacy is aperson’sfine stepin leaming and knowledge-building, 0 liter ines are essential in any measurement of human development, In a mare vatied set of indicators, importance would alo have tobe attached to the outputs of higher Jevels of educwion, Bur for besic human development, literacy deserves the clearest emphasis. The third key component of human development — command over resources needed for a decent living — is perhapsthe ‘ost difficult to measure simply. requires data on access 10 land, credit, income and other resources. Bur given the scarce data ‘on many of these vutiables, we must for the time being make the best use of an income indicator. The most readily available in. come indicator — per capita income —has widenationalcoverage, But the presenceof nontradable goods and services and the distortions from exchange rate anomalies, tariffs and taxes make per capita income data én nominal prices not very useful for international eaimparisons. Such data ean, honever, be improved by using parchasig- pomer-adjusted real GDP per capita fig tres, which provide better approximations of the relative power to buy commodities snd to sain command over resources for decent living standard. ‘A further consideration is thatthe ids catot should reflect the ditminishing returns: to transforming income inte human apa bilities. Inother words, people do not need excessive financial resources to ensure a decent living This aspect yas taken into account by using the logarithm of real GDP per capi for the income indicator All three measures of human develop- ‘ment sufferrom acommon filing: they re averagesthat conceal wide disparities inthe overall popalation. Different social groups have different life expectancies. There of- ten are wide disparities in male and female Iteracy, And income is distributed un- evenly ‘The case is thus strong for making dis- tributional corrections in ene form oe an- other (bax 1.3). Such eorrectionsare espe: cially importart forincome, which ean grow to enormous heights. The inequality pos- sible in respect life expectancy and liter- acy és much more limited: a person can be literate only once, and human life is finite. Reliable and comparable estimates of inequality of income are hard to come by, however. Even the Ginieuefficien, proba. bly themost widely used measureof income ineuality, bs currenly available for fewer than a quarter of the 130 countries in the Human Development Indicators atthe end INO HUMAR DEVELOP:of this Report — and many of those esti- sates ate far from dependable, Distribu tional data for life expectancy and Hseracy by income group are not being collected, and those available on rural-urban andmale- feenale disparities arestiltoo scant forinter- national comparisons. ‘The conceptual and methodological problems of quantifying and measuring human development become even more complex for political freedom, personal security, interpersonal relations and the physical environment. But even if these aspects largely escape measurement now, analyses of human development must not ignore them. ‘The correct interpretation of the data oa quantifiable variables depends fn also keeping in mind the more qualita- tive dimensionsof humanlife. Special effort must go into developing a simple quantita. tive measure to capture the many aspecté of human freedom, Attatnnsents and shortfall Progress in human development has. two perspectives: One is attainment: what has been achicwed, with greater achievements meaningbetter progress. The second is the continuing shortfal| from a desired value or target. In many ways the two perspectives are equivalent — the greater the attainments, thesmallerthe shoruialls. Burtheyaleohave some substantive differences. Disappoint: ment and dismay ut low performance often ‘originate in the belief that things could be much hetter, an appraisal that males the ‘conceptof a shortfall from some acceptable ‘evel quite central. Indeed, human dep- ‘vation and pavertyincvitably invoke short: falls from some designated value, repre senting adequacy, seceptability of echiew bili The difference between astessing at tainments and shortfalls shows up more clearly in a numerical example, Perfor mances often are compared in percentage shanges: 4 10-year tise in life expectancy from 6 years 10 70 years is 17% increase, bara 10-year rise in life expectancy from-40 yearsto 30 years is a25% increase, Theless theantainmentalready achieved, the higher athe percentage value of the same absolute ‘increase in life expectancy. Raising a person's life expectancy from 40 yearsto 30 years would thus appearto be a larger achicvemeni: than going from 60 yearsto 70 ycars. In fact, raising life expec: ‘ancy from the terribly low level of 40 years 10 30)yearsis achievable throwgh such rela- tively casy measures us epidemic contral ‘Bur improving life expeetancy from 60) years to 70 years may often be a much more difficult and more creditable accomplish- ment, The shortfall measure of human wate ‘Constructing « human development index Human deprivation and development of incoe into the flflinens of human Ive many facet, o any idexof harman ee the adjusted GDP per capita fig- [progress thould incorporate 4 range of ures have heen transformed into their fndicatooocapturethiscomplescy But logarithens. Jhving too many indicator inthe index To eonstact compose inex baprlanial precios tsopielar ah perperteciod ‘ointerpret anduse. Hencetheneedfor tom set equi to ope) an a ee Foes para er toperncemamfurpl ature ylece a broad scope with dh of eating xcn+ to 2c) had 10 be speci fc seeing ric pect of epition. he thre inet ‘This Report has chosen three types The minimum values were chose of srtntm the got ment: bing te reg 197 ee re ‘people’ depsvaton in life expectancy, foreach indicator. Fore expectancy at linerny and income fo « deceit living bit th tiniearn value was 42 yea ssandant. Each mesmrecouldhavebeen Afghanistan, Ethiopia and Sierra Leone. fartherrefined feypeciallybymakingdi- For adult incracy was 12% in Scmmaia ‘bution adhsimentiftherehidbeen Forthe purchasing powes-adhoned GOP adequate comparable data. Buin the per capt, the vale was $220 (lg vale sence of woh data, the foeus here rep- tpt teents a move inthe right direction: or adequate sg foe the arrow aed mikeadingt- achievement were Japaa's 1989 Me ci tention te only ene dienensian of tat penoh op fan iodo lf, whether economic o nc pais of 100%, and the mverage ‘The fie to indicators — We ex- "poverty line” incorne fn nine i Peceancy nc adult Hieracy — are cont- Seabee tacts ‘manly used concepts But the thied — ing power partes, oF $4881. The nine the purchasing power 1a buy commodi- countriesare Auseralia, Canada, the Fed tiesto tie eedh —innot as nal Repub of Germacy, the Nether- well TheGNP figures typi- land, Norway, Sweden, Switacrland, the cally wed for imernational cmpatisons. United Kingdom und the United State. differences is purchasing or the -vales are the sot nscale Seceencteliodetan Siemereninectne Tare Ibe pac basog pow saincaat = dev gegaioe lateness Salt ot GDP estirates cheveloped in the Inter- Soa laborative effort of the UN Statistical Seton iaeiaionciene ee ee ‘opment fox (FDI). A mathematical CQEGD, ECE and ESCAP, tow Slag formden of te HDI reach ‘expanded by USAID, And since there nical note 3,progress eaptures this betterthan the attain. ment measure does, ‘Taking once again the example of life expectancy, if 80 years is the tpet for calculating shordall, a rise of life expec: tancy from 60 years to 70 years is a 30% reduction in shortfall — halving it from 20 ‘years to 10 years. That is seen as a bigger achievement than the 25% reduction in shortfall (from 40 years to 30 years) when raising life expectancy from 40 years to 50 years ‘The shorefal thus has two advantages ‘over the attainment in assessing human progress. [t brings out more clearly the dif ficulty of the tasks accomplished, and. it ‘emphasises the magnitude of the tasks that still lie ahead. The Fieman development inde People do not isolate the different aspects of their lives Instead, they have an overall sense of wellbeing. There thus is metit in saying to construct # composite index of human development. Pastefforis iodevise such anindex have not come up with a fully satisfactory meas ure (see technical note 1). They have for cussed either en income oF on so tors, without bringing them together in composite index. Since human beings are both the means and the end of develop: ‘nent a composite index must eaptare both these aspects. This Report carries forward the search foe a more appropriate index by suggesting an index that captures the three essential components of human life —lon sevity, knowledge and basic income for decentlivingstandard, Longevity nd lnowl- cedge refer to the formation of human capa- bilities, and income is « proxy measure for the choices people have in putting their capabilities 10 ws. ‘The construction of the human devel- opment index (HD!) starts with a deprivae tion measure (bos 1.4), For life expectancy, the targetis 78 ears, the highest average lle expectancy attained by any country, The literacy target is 100%. The income targets the logarithm of the average poverty line income of the richer countries, expressed in purchasing-power-adjusted international dollars. Human development indexes for 130 countries with more than a milan (people are presented in the Human Devel. ‘opment Indicators, table 1, Thase foe an ‘other 32 countries with fewer than a million people are in the Human Development Indicators, table 23. wouke 11 ‘GNP per capita and the HD! “GO pee capa Poe 100 10.000 ‘onad Le POR Tanzania Myanmar vet am Zambia china si Lanka Country ranking bry HDI and GNP ‘Thehuman development index rankscoun: tries very differently from the way GNP pet capita ranks them. The reason is that GNP per capita is only one of life’s many dimen: sions, while the human development index ‘captures other dimensions as well Sri Lanko, Chile, Costa Rica, Jamaica, Tanzania and Thailand, among others, do far better on their human development ankingthanoatheirincomeranking, show ing that they have directed their economic resources more towards some aspects of human progress. But Oman, Gabon, Saudi ‘Saudi arabia Kunait United arab roraterure 2 Ranking of countries’ GNP per capita and HO! Human devdopmerst index 1 ws 130 countries ranked by human development Index (green line) and by GNP per capita (black line) ‘The chart shows. two separate distributions of counties. The upper curve represents theit ranking according to the human developmen index while the lowe: curve shows their ranking according to GNP per caprta, The two curves reeval that the disparay among. Countries ss much greater i» icarse than in human development, There is 60 automate link Ibetnee the level of per capita income in a country and the level of ic hurnan development. SING AND SMDASUIUNG Hitan DEVEL HeSMEN 0wRTS Huma development intncomplete with: ‘ut human fecedem. Throayhout his tory, people lee been wil tosiciice ther lives tpn ational and personal aserty. We have witnessed only recently an ieee wave of hurman freedom snwcep atom Easter Eutope, South ‘Africa rd raaey other parsof he world “Anyindex of umandvelopment shook! “herefore give adequate weight to a socicey's human freedoet in jputmlt tate ad pocial goal. The watuaion we put co similar rman development Achievement in different counties wil ‘While the need for qualitative jade ‘meats cleay, theres ne imple quantita ‘uve measure svalable yer wo capture the ‘uncensoret of law, guarantees offre speech ae 0 ft fifi Freedom and huanea development their creativity and: productiviy, that “would shi! up in income estimates oF ners level Yn addition, the human. developement concept, adopted in this Teper fsa cn pel esis 6, inother words, peopl’ Sacpen aes ak coord the essence of freedom. For ilusrative purposes the tbe below abows a selection of counties (within each region) date achieved « high Sevel of human developrent (relay tive to other sounirics in the region} within reasonably democratic polccal ‘tnd social Gumewotk, And a cursory sencentberthng of cineca of the Human Development ton, given atthe enol thisrepar, shows tha coutares ranking high fa their HD bso have a more desaocrtis framework — and vice versa — with some notable ‘What is needed is considerable empirical work to quai vari kd (on, Tosorcertent.howeverhehuman catocvofhuman freedom and toexplre decpratinketDD apneesene fterhen towne eon tspecuofhaman freedom. Foresample, and human development. if the supprenion of people suppres ‘Top 15 countries in democratic human develapment Country Wot Country Hor tate Armee arc te Coban ‘Mea Eat ahr alco esta ica ‘adhny 0751 Unga Tu 657 ‘edad and Tobago Sub-Saharan re Mass ome Sotmana od Beate 057s Arabia, Algeria, Mauritania, Senegal and Cameroon, among others, docorsiderably ‘worse on their human development ranking than on their income ranking, showing that they have yet to translate their income into corresponding levels of human develop- ment To saress agsin an euler point, the human development index captures a few ‘af people's choices andlleaves out many that ‘people may valuc highly —economic, social ‘znd politica freedom (box 1.5}, and protec tion against violence, insecurity and dis- ccimination, to name but a few. The HDI thushas limitations. Bur the virtue ofbroader ssoverage must be weighed apainss the ia- sanvenience of complicating the basic pic~ sre it allows policymakers to draw, These tradeoffs pose « difficult issue that future editions of the Hurran Developereut Report will continue vo discuss(CHAPTER 2 V4, Human development since 1960 ‘The developing countries have made sig- nificant progress towards human develop- ment in the last three decades. They in- creased life expectancy at birth from 46 years in 1960 to 62 yours in 1987, They halved the moreabty rates for children under five and immunised! tww-thitds of all one- year-olds against mujor childhood diseasex The developing countries also made pris mary health care accessible to 61% of their peopleand safewater10559% (80%in urban areas), Ih addition, they increased the per capita calorie supply by about 20% berween: 1965 and 1985, Their progress in education was equally impressive, Adult literacy rates rose from 43%in 1970 10 60% in 1985 — maleiteracy from 33% to 71% and female-tieracy feom 33% t0 50% ‘The South's primary ed Tioaull aurpat in 1985 was alot six times greater than that in 1950, its sccoodary educational output more than 18 times arester. The results were 1.4 billion literate people in the South in 1985, compared w reat a billion in the North North-South gaps in human develop. ment narrowed considerably duting this period even while income gaps tended 10 widen, The South's average per capita income in 1987 was sill only 6% of the North's, bu its average life expectancy was ‘80% and its average literacy mute 66% of the North's, The Nonti-South gap in life ex pectancy narrowed from 23 years in 19640110 12 years in 1987, and the literacy pap from 54 percentage points in 1970 to ess than 40 petcentage points is 1985, The developing ‘countries also reduced their average mfant mortality from 200 deaths per 1,000 live ‘bimhs 19 79 hecween 1950 and 1985, 4 feat ‘that took nearly 2 century in the industrial ‘countries ‘This progress mist be pit in perspee- tive, however. Fin, tremendous human depeivation remains. There sil are nearly 900 million sclults in the developing world who cannot read or write, 1.5 billion people without sccess to primary health care, 1.75 billion people without safe water, around 100 mil. lion completely homeless, some 800 million People who still go hungry every day and moee than abillion who survive in absolute poverty. Children and women suffer the most. Sorte 40 million newhoms still are not properlvimmunised. Fourteen million chil- ddhen under the age of five die cach year and 150 millon are malnourished, ‘The mater- OURE 2) ° Disparities between developing and industrial countries Suen aa sapere ats o od 20Significant lnumeen progre exists with tremendaus human deprivation tal mortality rate in the South is 12 times higherthanthatinthe North,andthe female illiteracy rate is at Least 15 times higher. Obviously, thebacklogofhuman depriva- tion presents a challenging agenda forthe nextdecade Second, the recent progress innarrow- ing human development gaps between North and South raises hope — and a question mark. The hope is thatthedevel- oping worldean he taken toa basiclevel of humandevelopment ina fairly shor: period —ifational developmenteffonsandinter- national assistance ate properly isected ‘The question mark relates tothe fact that four-fifths ofthe people inthe Thind World are leading longer, better educated lives, butthey lack opportunities totap their full Unless economic opportunities createdin the South, more humanitalent ‘vill be wasted, und pressures for interna- ‘tional migration are likely to increase dea. matically, Moreover, while gaps in basic survivalhave narrowed, the widening gaps in science und technology threaten the South’sfuturedevelopment, ‘Third, the average figures for human development hide considerable disparities among countries inthe South. Lifeexpec- tansy exceeds 70 years in 13 developing countries burt is still less than 30 years in another 20 countries, Similarly seventeouin- tries have literacy rates over 90%, but an- other seven have rates less than 25%. In general, the leastdeveloped countries, many in Africa, suffer the mast human depriva tion. Ofullthedeveloping regions, Aftiew thas the lowest life expectancy figures, the highest infantmoralityrates ancl the krwest Iiteracyrates. ‘This trend towatds the concentration of povertyin Aitica is growing: more than half the people in Africa live in absolute poverty. The number of Africans below the poverty ine rose by two-thirds in the first half of the 1980s — compared with an increase of about afifth for the developing world asa whole — andis projected to rise rapidly in the next decade, Any interna tional effort to improve human develop: ment in the Third World must thus give ation to Africa and the other loped counties. Fourth, the gaps in human develap- ment within countries are alse great — hetween urban and rural areas, between men and women and between rich and poor, Fordevelopingcountries asawhole, urbanateashave twice the access tohealth ‘services and safe water ay rural areas and fourtimes the access tosanitation services. Femule literacy rates are anly two-thirds those ofmen, And thetich often appropri- tea major share of social subsidies. These wide disparities show the considerable room forimprovementia distrburingsacial expenditures. Fifth, human progressewerthelast three decades has been neither uniform nor smooth, Many countries recorded major reverses inthe 198 —withising ratesof child malnutrition and infant mortality, patticularlyin Sub-Saharan Alrica and Latin America. Budget cuts greatly squeezed social spending. Some countries avoided reductions in social programmes through beiter economic management, but mest countelesin Africa and Latin America paid heavy social price duringthe adjustment period of the 1980s, The 199s present the challenge of rectifying the damage to human develop- ment in many developing countries and then building up momentum to achieve essential human goals bythe year 2000. The responses tothischallengewillrequire more resources, mobilised bothdomestically and internationally, andin many instances they ‘willalso require major shiftsin budget pri- tities. Needed mostare cutsin spending ‘onthe military,on inefficient public enter- prises and onmistargeted social subsidies. ‘Tocreatetheenabling framework formore broadly bused development, macroeso- arnic policy formulation and management must imprave, and popular participation and private initiatives must increase ‘The remainder of this chapter docu- mentsthe recordof human development in the developing world since 1960, The last section also takes up some of the human toblems now confronting both developed and developingcouniries. The discussion throughout reinforces this Report's hasic thesis: income alone is not the answer to humandevelopment.Expanding human capabilities Thekeycomponentsof the humandevelop: ment index —life expectancy, lxeracy and basic income — are the starting point for this review of the formation of human capa- bilities. Basic ncomeisused here us aproxy for access to resources for a decent living standard, The review also examines some major contributing factors, especially rpeomle’s access to food and such social services ax water, education and primary Iheahth care. Life expectancy Lifeexpectancy'in the developingcountries has risen on the average by easly a third since 1960, from 46 years to 62 years. But this average masks important interregional aand intereountry differences. Afticu's aver- age life expectancy is only 54 years raging from 42 years in Ethiopia and Sierra Leone to 69 years in Mauritnas, Asia's average life expoctincy is 64 years, reflecting the rise in ‘China's life expectaney from 47 years 10 70 years in three decades, Latin. America’s: averuge life expectancy is 67 years, fairly close tothe industrial nations’ average of 69 years in 1960. Nine Latin American. and Caribbean countries fall into the group of 18developing countries that already havea life expectancy of 70 years Life expectancy generally ix-well corre: lated with a country's income, but impor: tant exceptions show that significant gains in life expectancy ean be made even at modest incomes. Sri Lanka ($400 per cap: ita) enjoys a life expectancy af 70 years, as high as that in the Republic of Korea ($2,690), Venezuela ($3,230) and the United Arb Emirates ($15,830). Rapid advances in health and nutrition made these exceptional gains possible. Uneil the mid-1970s the average life expectancy in low-income countries was increasing three times faster than that inthe middle- and high-ietcome countries, burt since then the increase has been only slightly faster, As a result, the life expec tancy gap between least developed coun: tties and the developing countries as a whole has widened from seven years to 12 years Tat Life expectancy, 1960-87 2peuate neat 10-87 Tae page ‘Hong Xone 4 Cost Rc as Cha a3 ‘Unite Arab Eien 408 lari 409 swat 393 Cate 370 Natapia 248 ered, Re 33 Panwa 338 {lope ose Fuapuay oie ee 22 Kampuchea, 8 Algpanatan oat Sera urore ose enna oa Guinea 388 Cental Atrican Rep 890, ab oot South 2a North 2 Ute expectancy ‘ear Tigres ie erp org Kong ie Con ea % lama nd B anast 8 noma 2 te 2 wy 4 nse Brats Emits n Leet fe expecta Sera tone a ‘hops a Aohanitan a ‘Seren 3 ai 3 agola re Noe s ferata “% ert! Aan eo « Sud ry 19601987 seu & mR a owe 22 Life expectancy trends ae... fee 1960 eu 23 1978 1987 »my Hi q Tah Adult Ieracy rate, 1970-85 azn te Aaah ofreoxcten ae ie shomfad 5) 170-88 1985, eset progress Highest ieee fame tag 135 hie cs Cale wwe “Tenia aed Tbago 6 rng 623 Argent 6 Thaiaed 548 rue % lean as Genta Ra a Botan 470 area, Re oF Triad are Taboo re a Zamib a8 Mesice 0. Peru aan Parma 2 Venenodia an oa eo ‘lower, counties with an adult Lowert Stacy ate hey ent feat tht 5% ‘Semele iz rtina fo oad ‘Barkin Fane ri ‘suger O58 tiger 1% Somat ra at 7 Mal 073 Maurras 7 Her on ‘Sudan 2 ran Be ‘Yemen Arab Rep. 2 Bere 994 puter Ec India 097 Nepal % Nepal 107 1971985 South a3 eet frit Pos HMA DEVEL OPSMESST SINCE 9Progress in reducing the deaths of chil- dren under five, especially infants, has contributed greatly to: higher life expec tancy, Developing countries reduced their infant (under age one) moetality rate from neatly 200 deaths per 1,000 births in 1960 to 79in 1988 —and their child (under five) morality nite from 243 deaths per thou- sand to 121 ‘Some countries have dane particularly well, often despite modest incomes. Jamoaica’s child morality rate was 22 in 1988, compared with 85 in Brasil, a country ‘with more than rice the per capita income cof Jamaica, Similatly, Mauritius has the lowest infant and child mortality rates in Africa — having reduced the deaths of children under five from 104 per thousand 10:29 since 1960, aperformance much bet- ter than that of countries at considerably higher per capita incomes, such ax Gabon and South Africa. Some developing coun tries withthe lowest infant mortaisy rates in 1988 — HongKong, Singapore, Costa Rica, Kirt and Chile — are also among the countricsthat reduced theirinfantmartaity rates fastest hecween 1960 and 1983, Literacy Rapid improvements in. education have sharply increased the ability of people in developing countriesto read and write, The literacy rate for men tose from 53% in 1970 to 71% in the first half of the 19805, Ale though the female literacy rate was still only 50% it 1983, encolient rates for girls have bbeen increasing far more rapidly than those for boys, an encouraging sign. Several developing countries already haveaduls literacy rates above 20%, compa rable to the rates in many industrial nations. Despite such successes, some of the most populous counuries, such as India, Bangle desh, and Pakistan, have been extremely show in cechucing widespread literacy. Sub-Saharan Arica has witnessed espe~ cially fast progress inaduk literacy, bursince it started from avery low point, its average literacy rite oF 48%: in 1985 was still far below the avernge af 6(M% for the develop. ing world. Low-income Kenya made spec: tacular progress in extending universal pi rary education and raised its leeacy rate from 325% in 1970 10 60% in. 1985. Literacy rates in. Latin America com. tinue tobe well ahead of those for all other developing countries, havingrisen from 72% in 1970 to 83% in 1985. Asia'sliteracy rates closely follow the developing country aver. age. They have moved from 41% 10 59%, Holding down the region's average are four South Asian countries: Bangladesh (35%), Pakistan (30%), Nepal (26%) and Afghani. stan (24%), South Asia's literacy rate was nly 41% in 1985 — the Fowest of all the regional rates, The least developed countries have an average literacy rate of only 37%. «AS with other human development indicators, the disparity is growing between their perfor mance and that of the developing countries asa whole, Theirliteracy gap widened from 18 percentage points in 1970 10.23 percent ‘age points in 1985, ‘The number of iterate people in the developing world, just under $00 million in 1985, may well reach a billion by the end of the century. Three-quatters of them livein the fire most “Asian countries: India, China, Pakistan, Bangladesh and Indonesia. Any uttack on global illiteracy will thus need to concentrate on these sountties, Income ‘The growth of per capita income, one of the ‘sritcalelementsin improving human devel- ‘opment, was 2.9% a year on average foe al developingregions berween 1963 and 1980, ‘This trend broke sharply in the 1980s. Sub- Sahain Africa's per capita income grew by only 1.6% a year berween 1965 und 1980, ‘but it has since been declining by 2.4% a year, Latin America, because of persistent debt problems, moved sharply from 3.8% annual growthin percapitaincomein 1965 80 to an annual decline of 0.7% in the 19805, For human development, the distriba- tion of GNPisas important asthe growth of GNP. One measure of the distribution of income is the Gini coefficient, which eap- ‘370 985 “GHP per capita trends ”tures disparities in the percentages of in- come that each 1%% (percentile of the popa- lation receives. If each percentile reveives 1% of the income, there is no dispatity, and the Gini coefficient is zero. fone percen- tile receives all the income, there is maxi- mum disparity, and the Gini coefficient is 1. Tn nine of the 28 developing countries for ‘which the Gini coefficient is available, itis 0.50 or higher, shossing chat a small part of the population in these eourstics is gesting 2 very lange pat of the income, Another indicator of inequality is the ‘per eapita income of the richest 20% of the ‘population compared with that of the poor- ‘st 20% In 12 of the 23 developing coun tries here such a compurison is available, theincome of therichest grouptas 1Stines ‘oc moce that of the poorest group. Yer anathes distributional indicator in predominantly agriculturaleconomies isthe concentrationof land, whichishighlyskewed in Latin America. Of 17 countries surveyed, 10 show fand concentration indices (Gini coefficients) above 0.8, and five between 7 and 0.8. The FAO estimates that about 30 million agricultural houscholds have no land asd about 138 million are slmost lan- dless, two-thirds of them in Asia. ‘Most poverty estimates for developing countries use the income needed to meet minimum food needs and thas measare absolute poverty (see technical note 2) ‘County data are sparse, however, and not alwayscomparable. The availabledatareveal aan overall reduction in the percentage of people living in absolute poverty between 1970 and 195. Bur owing to population growth, the absolute mumber of poor in- ‘creased by about afifth, In 1985 more than a billion people in the Third World were trapped in absolute poverty (box 2.11, In Latin America more than 110:illon people, about 40% of the population, lived in poverty in 1970, a quarter of them in extreme poverty. Fifteen years late, nearly 150:millon people, more than thiedof the population, were sull poor, largely asa result of the ecofomie staghatian in the 1980s. Poverty isso widespread in Latin America, despite its high average income, because of inadequate distribution of income in many countries, Brazil's GNP per capita was $2,020 in 1987, but the poorest 40% of Brazilians received only 7% of the house- hold income, The top 2% of landowners control 60% of the arable land, while the bottom 70% of rural houscholds are land: lessor nearly landless For Africa the ILO estimates that the number of absolute poor rose in the Five years between 1980 and 1985 to move thant 270nillion, sbouthalf the total population. Tf nothing is done to reverse this ominous trend, nearly 400 million people will be livingin extreme pavertyin Afitea by 1995. In Asia the percentage of poot people is decreasing, but the greatest number of the world’s poor, three quarters of a billion people, stil ive there. Poverty is extensive in Bangladesh (where more than 80% of the ee the Lao ‘ties’ people in abeolate poverey, Africa rural Acca apd fm the urban slams of | Pople are poor), Nepal, India and the 2MP% and Latin America and the Cary Latin America. Female member ofa | People’s Democratic Republic. The 19808 bean 124% Poverty is rowing fastest in poor household wre often worse affthan | have been expecially harsh for some coun- _ASvca, withthe number fubsokite poor ale members hecaute a tries: in Sei Lanka snd Bangladesh, the having increased bye about cwo-thinls differences in the distrbution of food and other entithements within the fasnily. ‘Third, three-quarters of the devel- Ip Affics women produce 75% of the spinacoues pepenlelieinnal fal thy ler pete dep = me poorest income groups had their shares of household income fall. Some East and Southeast Asian economies have neverthe- less made tremendous progress in alleviat- ing povertyPoverty isby no means a probleze of the developing countries alone, nar ean consis- tent rates of economic growth guarantee its alleviation, In the United States, after 200 years of ceonomic progress, nearly 32 mil- lioa people, about 15% of the population, ane still below the official poverty line. ‘Access to basic poads and services The extent to which people ex improve their cupabilities depends largely on the access that they have to basic goods and Food. There has heen a general global improvement in food productios and ealo- rie supplies. The daily supply of calories in the developing word improved from 9% of total requirements in 1965 to 107% in 1985. Confirming this evidence, food pro- duction data show a roughly 20% increase in average caloce supplies per person between 1965 and 1985. Countries having the most urgent need for food show the slowest progress, Forthe poorest countries, the daly pet capita calo- re supply increased only from 87% of the total requirements to 89% between 1965 sand 1985 Regional disparities in daily calovée supplies are stark. Sixtcen African coun ities, of the 34 having data, recorded de- clines in their supply of calories per capita, ‘while Gabon, Niger and Mauirtiushad theirs increaseby 15%oc more. fn Latin America, the disparities are similar. The best progress was in the Middle East and inAsiawhere the per-capita caloric supplies went up by 30% and 23%, respectively. Estimates of world hunger vary. Ac- cording to the World Food Council, more than half.a billion people were hungry in the mid-1980s, The World Bank, in a study of 87 developing countries with 2.1 billion people, put the number of undernourished people — whose diet does provide thers with enough calories for an active working life —at 750 million in 1980, The figure is ‘growing constantly, with as many as eight rillion people sid to have joined the ranks ‘ofthe hungry each year during the first half ‘ofthe 1980s, Hunger today maybe stunting thellives of as many 2s 800 million peaple in the Third World a Sa cua, ae a a aspera ons on eas =a me ar oa fee = = 2 s ae he Raa - = eee cea E i a ea E ee ee : ae ia. : “ > See E Bre a : saa a. ee E sent aes ee ae ee oe A ace ae : i BS BS a5 : a ie % zm Ste 3 be 2 i = a. : oe ae ie : = 2 : = i 1c = ss i cyrou ‘Access to health services, 1985 ak developing “bab Saharan Area rou 2s ‘Access to sate water ends ecana of ppition ——— Tad a5. 1985-87 cue 210 North-South distribution ‘of school enrolment. orth South ees Freon euay ™ ‘Two-thirds ofthose hungry'n the devel- coping-counteieslivein Asia, and aquarterin Africa. Mirroring this distribution is the ‘number of law-birth-weight infants in di ferent regions, with Asian countries having. some of the highest figures. A major challenge for the 1990s is thus: to ensure that food procliction shereases rapidly, particularly in Africa, and that food is well distributed — supplemented where necessury by targetted nutritional pro- ‘grammes for the poorest and most vulnet- able groups. Health comvices. Rely and affordable access to health services is vital for haman development. Most countries collect data onthe percentage of people with ¢asyaccess to health services and on the number of doctors and nurses. But these data do not mean that health services are actually avail- able to people. Ductors may be concen- trated in urban areas, possibly specialising in expensive tertiary medicine. People may be close to health services but unable to afford them. Despite the current limita- tions of available data, some broad eanehi- sions are possible, Severaldevelopingcountriescame close tothe objective of primary healthcare for all during the 1980. Many of them also stand ‘out in life expectancy — for example, the Republic of Korea, Costa Rica, Jamaica, ‘Tunisia and Jordan, On the average, how- ‘ever, only 61% of the people in developing countries have access to primary health care services today. For the least developed -couintres and Sub-Saharan Afpica, the eo. responding figures are 46% and 45%, respectively. Accesstohealth care, accordingto every available measure, is worst in Africa. In Latin America, which has the most doctors and nurses per person in the developing ‘world, only 61bofthe peoplehaveaccessto health services, well below the averages for ‘Asia, North Airica and the Middle East Excmplifying the considerable progress in the Middle East and North Africa, Ku- ‘wait new has more doctors per person than Switzerland, But Kuwait's infant morullity rate is still four times that in Switzerland, reinforcing the argument that the avalabil- ityof doctors i 90 guarantee of good health Water and sanitation, Progress in water and sanitation has generally been. much slower than that in health, and it hus been slower in sanitation than in water. More than half the people in developingcoumries had access to aafe water in 1986, up from 3thin 1975, In the bert performing coun- ‘ries, practically every person has access to safe water. For the least developed coun- aries, however, the rise was a mere four percemuge points: only a third of their People haveusource of potablewater within reach. Latin America has made good general progress, with nearly three-quarters of the people there having access co cafe water in 1980-47, Chile and Trinidad have reached developed country standards, Progress in sccessto-safe waict has also then. impressive in the Middle East and North Aftica. Several countries there re: port that more than 90% of their people have access to safe water, andealy in Sudan and the Yemen Arb Republic do fewer than half the people have access. Asia made good progress between 1973 and 1985, inereasingthe access tosafe water to more than half frorn less than a third of the population, Bur in Bangladesh the access has declined by 10 percentage points since 1975. ‘Africa shows the least progres. In a third of the countries having current data, the access to safe water declined, and in cight African countries fewer than a fifth of the people have access to safe water. For sanitation, about a third of the South's population had access 19 proper facilities in the second half of the 1980s, Edveation. The enrolment gains have been impressive in most developing coun: tries, despite their rapid population growth. ‘Well over 80% of the children of primary school age were enrolled in primary schools in 1987, and several developing countries ate close to the goal of universal primary enrolment. ‘The progress has been considerable in every region. Despite stagnant economies and rapid population growth, hulf the chil- drenof primary and secondary school age in ‘Africa now attend school. Asia, the Middle East and North Africa also show stcadityrising trends swith net primary school enrol- ment ratios of well over 80% for males Further progresshasbeen held back by low enrolments of females, an insbalance that ‘urureedueation programmes must redress An Latin America and the Canbbean, the ‘net primary school enrolment ratio reached 75% in 1985, with equal participation by fhoxs and gists ‘The experience of developing countries swith secondary and tertiary education has hheen varied In East and Southeast Asia, ‘secondary enrolment ratios in the newly industrialising countries rose to 90% for ‘both females and males. Tertiary enrol ments also increased considerably. Some Latin American couniies surpass even the ‘Asian newly industrialising eourntics —and even some of the old industrial countries — in tertiary enrolment, By contrast, tertiary enrolment in the least developed countries is 19640r femalesand 4%:ioe males, showing how much they have tncatch up during the feat few devades. The plobal distibution of hasic educa tionhas changed radically since 1960. The South now has more than four times as zany students in primary education as the North (480 million compared ‘with 105 million! and abou: twice ax many secon: dary-level students (190 rnllian compared with 87 million), But the South still has 0 catch up in tertiary education — and in science and technology. It abo has to im: prove the quality and releeance of tuelents knowledge, for which pare of the ground: worl hasbeen laidin the past three decades. More people shaving sance resouniex Life has become more liveable far most of the Word's people, with millions finding access to improved goods and services Disappointing, however, is the equally siag- fering sumber of people suffering severe deprivation (box 220n p. 27), This does ot mean, however, that development has failed. Ic means that population growth has ‘outpaced part of development’s success. Tuo billion people have joined the world’s popnilation since 1960), bringing the total to more than 5 billion people today. Most ofthe population growth hasoccurred in developing countries, where the popula- tion has doubled, and this trend is likely ro continue for decades. Thedeveloping countries! overall popu- lation growth is expected to decline from 2.394 year between 1960 and 1988 102.0% a year between 1988 and 2000, But some parts of the world will not achieve even this modest slowdown in growth — Aicica's population is projected to cantinue growth by 3.1% yearberween now and 2000, andl the least developed countries’ popul by 2.8% a year. The developing courtrics’ share of world population, now 77%, ix projected to rise eo 80% by 2000 and 4% by 2025, For mest developing countries, human development thus poses a triple challenge. They huve to expand the development oppor tuesties for a growing meumiber of people. They have zo parade living standards. And they often have to achinve mowe with let — 10 meet the first two-challenges with stagnat- ing or even declining resources, Between 1980:ind 1987 the developing courtney’ share in world GDP fell almost two percentage points (fram 18.6% wo 16.8%), while their share in word popula- tion moved up ofe percentage point (from 74.5% to 75.6%), The combined impact of these changes proved difficult for them to ageommosite RGURE RTT World population trend and North-South distribution iicrs oF people g[Feoume 212 Wage employment and labour force outside agriculture: ‘Aeevage annual genth ate 1979-87 Central African Republic Si Lanka The developing countries’ decline in income must be halted toavoid the growing risk of sharp reversals in human develop- ment. Early solution of the debt crisis and better opportunities for trade will be as necessary as stronger efforts by the develop- ing countries to improve their economic performance with scarce resources. Using human capabilities Skilled, healthy and welleducated people are in a ester position than others to take their lives into their own hands. They are sencrally more likely to find ermployment and cam better wages, They have better access to information, such as that gained through agricultural .or business training. andare thus more likely to succeed as farm erorentzepreneurs, The educated can also contribute more 10 the advancement of culture, politics, science and technology. ‘They aremorewaluahleto societyandherter ‘eauipped ta help themselves, ‘The use of human capabilities, as con- ceptualized here, encompasses the use people decide to make of thei abilities as well as their usefulness to society, Employment ‘More than 900 million people have joined the developing countries’ labour force in the past three decades. High population growth was not the only reason. The ranks of thelabourforce wercinereavedby women seeking johsand by poores fumiliestrying to increase the number of income earners in ‘the family, During the 1990s another 400 million ate likely to join the labour foree: Economic growth has failed to provide enough employment opportunities for the job-seekers of the last three deades. Reli- able data on open unemployment do not exist, but it is common knowledge that unemployment and underemployment are ‘extensive in many developing countries. ‘The 19805 saw rapid rises in informal sector employment. In Africa the informal sector accommodated about 75% of the new entrantsinto the labour force between 1980 and 1985, and the formal sector only 6%, In Latin America berween 1980 and 1987, the informal sector absorbed 56% of thenex workers Governments have long ignored the informal sector, but that is beginning to change. Its increasingly being realised that the informal sector needs active political and economic support. It is, afterall, abe sorbing the bull of new workers, particu. lashy women, youth and the poo. ‘The fuller use of human capabilities requires sustained economic growth and considerable investment in human beings. ‘The returns from such investment are ex tremely high. A World Bank study shored private returns.to primary edueation as igh 1 43% in Africa, 31% in Asia and 32% in Latin America. Fordeveloping countries as iv whole, average social returns for every level of education exceed 10% to 15% Differencesin technieal and general educa tion accounted for about a third of the differences in agrivubiral prochuctivty in the 1960in the United States and a sample of developing counties. The special re> tums to female education are even higher, in terms of reduced fertility, lower popula tion growth, reduced child mocuality, re duced school dropocr rates and improved family eutsition.Balance sheet of human development © 13 billion people have acess to adequate sanitary ‘Women enrolment rates for git ‘been increased ScireeetretteeeIn greater numbers than ever before, people are moving across boundaries and continents Skill formation, in addition to general education, promotes more productive uses of human eapabilite,, Culivatory in the Republic of Korea, Malaysia and Thailand —using modem technology — produced 3% more output for every additional year of schooling theyhad received. Andthe higher Jevel of education of farmers in the Indian Punjabexplainsin part why their productiv- ity is higher than that of farmers in the Pakistani Punjab, Investment in human capital hus incresses people'«productivity tirlenkamorsibeshansesefikek employ ment — by raising the potenital for funure ceonomic growth. Ofcourse, ifedueation does nor create the skills demanded by: society, ican lead to educated uneroploy- ment and considerable waste of human Potential, Migration Ingreaternumbersthaneverbefore, people aire maving across bound: andl con nents in search of new op} both ecanomic and po! transport systems and communis networks have encouraged more and more people to leave their countries and sctale elewhere. They are moreaware than pre: viously oftheir deprivation —more aware fot ther lives differ from those of people inothercountrics. And this drives them to search for the seemingly better life and greater opportuniticsacross the border, If theyhadseen better opportunities athame, they might have preferredto sty. Formany migrants the economic decision tolcave is voluntary. For political andenvironmental refugees, however, there seldom is achoice, ‘Often well qualified, somemigrants are highlytrained spectalists. Theyoftentexve forhigher salaries and moze jobsatisfaction. Some governmentseven see advantages in people leaving. Theit remittanceseanbean import source of forcign exchange, help: ing toimprove the balance of payments, ‘The brain drain hit Africa parsiculaly hard in the 1980s. With a thin layer of qualified personnelto start with, theloss of even afewkey specialistshas had dramatic consequences. The brain drain from the ‘more populous countries of Asia and from ‘most Latin American countriesisgenerally Tess dramatic. Inthe carly 1980s the number of eco: nomic migrants stood ataround220 million —und thatof illegalmigrants, generallyless suulified than theofficiall registeredones, rmuscbeat least ashigh, So, pethaps 40 t0 ‘50 million peaple have moved inope of a bigger share of the world’s development benefits ‘The traditional recipients of migrants from developing countries — Canad: Australia, New Zealand, the United States andl the European countries —have adoyiied measures to limit the influx of rigeants ‘The United States granted seme 5 miltion people permanent immigration statusin the first half of the 19805, compared with 2.5 rillioninthefive preceding years. Europe's forcign population hus, for about twodee: ades now, been around 16 million. And even in the Middle East region, immigra- tion isstabitising, South-South migration is growing be: cause ofthe increasing restrictions on mi- gzation 10 the North and the inereasing Povertyindeveloping countries, The main recipientsin Aficabavebeen Cated'Ivoire, ‘Senegal, Ghana and Cameroon. The main ‘countries of origin include such least deve! oped countries as Burkina Faso, Mi Guinea und Togo. Lesotho and Mozam- hhique continue to be major suppliers of labour to South Aitiea ‘Argentina, Venezuela and Beazit are sibout the only majorrecipient counriesfor ‘economic imigrantsin Latin America, with the UnitedStatescontinuing tabethermain destination by far. The maincountries tha ‘export labourin the region are Mexicoand Colombia. ‘InAsinthe mainreleasingcountries are ‘Bangladesh, India, Pakistan, thePhikippines, ‘Thailand and the Republic of Korca — sige to the Atal states and the United Popular participation anid tbe NGO movement ‘Feonmie migration isone way for people to seek greater involvement in develop- iment, Popular patticipationin communityaffairs — economic, social and political — is another way, and in eecent years it has fined in importance. Many community and otherself-help organisations nw assist peoplein exploiting heir collective strength toresolve some of thechallenges they face —theis need for a road, a health centre, cf an irrigation system, for education for their children, of for aecess to assets and credit. ‘Added to these community self-help organisations are a large and still growing number of nongovernmental organisations (NGOs)that typically work asintermediar- ies berween peopleand governments. Underpinning the NGO movement's growth are privateinitiativerby concerned citizens and the sponsorship of government, The NGOs suecessin shifting the focusof development topeoplehasin many coun: {ties moved them into afully collabora relationship with the state, Governments arebeginningtorealise that NGOs—small, fexibleand with good local rootsand con: tacts — often are much better suited to carryourthework of development thanisa largeburcauctaticmachine One of the NGOS’ big successes isin arranging credit for the poor. ‘The poor traditionally staypoor because they ave ne assetsand are seen asunsorthy of even the smallest amount of credit. NGOs have changed thisby showing chat join. liability approach — with closecaatactand commu: nication between debtor and creditor — can help boost repayment rates and open more credit opportunitiesforthe poor within theofficial creditsystem. The NGOshave closely supervised, and provided advice to, borrowers —takingonthe often very time- consuming functions that banks typically shy away from. In Peru the Institute for the Develop- mentof the Informal Sector hasestablished programmes to help sinall entrepreneurs and community groups gainaccessto credit Itprovielesbank guarantees for participants anel arranges the technical and managerial advice and training they need to set up viablebusinesses Another NGO in Bangladesh, the Gra» meen Bank, provides innovative finks be- tween the government, commercial banks TAN DEVELO and outside donots on the one side, and landless entrepreneurs interested ia bos rowing but lackingcollateral on the other. ‘The Grameen Bank helps the landless or- anise into groupsto secure loans, and most ofits clientsare women. Other NGOs mobilising rural savings and making credit availableto the rural poor inelude Roanda’s Banques-populaires, Zimbabwe's Savings Development Foun- dation, Ghana's Rural Banks and the Phile ippines' Money Shops (see boxes 4.2 and 43 inchapter4) ‘The momentum of people's participa- tion duringthe second halfof the 1980shas done far more than prove that people can help themselves, ft has contributed ta a fundamental rethinking ofthe relationship between the state and the private sector. Policymakersnow recognise thatdevelap- ment canbenefitfrom people’sinitiatives, and that these initiatives must be encour- ‘aged rather than stifled, ‘There ina growing consensus that the state mustbe strong und effective increat- ing an enabling framework for people to rake their full contribution to develop- ment —to expand theircapabilitiesand ta pput them to use — bat that it should not undertake developmental functions that NGOs, entrepreneursnd people at large cancarryout better Disparitiesanddeprivation within nations Every country has shared to a varying de- grecinthchuman progressoverthe past 30 years. But averageimpravementsconceal considerable inequality within countries and ‘mask the continuing severedeprivatioaaf manypeople. The prcvailingdisparities aso show the great patential for improving hhumun development by distributingincome better and by aggressively restructuring budget priorities, This section focusseson the disparities beneeen rural and urban areas, berween males and females, and between rich and poor. Again, the lack of appropriate data hinders a systematic review. Use i thus made of special eusestudiesto supplement the available cross-country data, ements conceal considerable inequality between rural and urban areas, between males and females, and between rich and poorGURE 213 Rural-urban disparities Fecentage of oition woracers so mea senses ‘Two-thirdsofthe peopleinthedevelop- ingcountres live in rural areas, bs in many ‘countries, they receive less than a quarter of the social services for education, health, ‘water and sanitation. For developing coun ‘ties asa whole, people in urban areas have ‘rwice the access to health services and sale ‘water and fourtimes the sanitation services ‘that people have in mural arcas. nmany countries, rural-urban dispar: tics reflect the distribution of income and thelocusof power. These dispazities, often high at lower levels of human development sand per capita income, tend to narrow aver time, But there are several exceptions to ‘such a generalisation. Argentina has very ‘igh rural-urban disparities, despite is ela~ tively high per capita inceme and human development. Tanzania, by contrast, has a fairly good ycographical distribution of social ‘services, even wich its low income. ‘The following examples show how rural areas systematically lag behind urban areas in human development. rece Bist ‘population Aegertina ate Mazwmbque Pastan Somalia Low osamry Algeria comarca Hordes ores, Feo fannaeia ural 1“ 0 % @ 6 ges Health water Sanitation Bural Urban Aural Urban Rural Urban 2 na 8 «0 Bons 33 30 109 om” Bos sm Dw 6 3 Ce 54 | seas + Infent mortality. For several Central American countries, infant mortality is sencrally 30% to 50% higher in rural than in turban areas, Costa Rica, Guatemala and Nicaragua narrowed some of the pap in the 1970s, but ocher countries have not been able to match urban progress in rural areas, * Life expectancy, Rural Mexicans have a shorter fe expectancy (59 yearsbthan their turban counterparts (73 years), © Nugnton. Dataonthe nutritional status of children in 31 countries show, without exception, higher rates of malnutrition. in rural areas, 50% higher on average, © Literacy. For selected countries in Af- rea and Asia, rural illteracy rates pencrally tre twice the urbun rates —and for women in Latin America the rural rates are three times higher than the urban rates, and for men, four times higher, © Health facilities. Access to health care is better in urban areas than in rural areas in every developing country. In some 20 de: veloping countries the percentage of the population covered by health facilities in turban areas is more than twice that covered inrural areas, Even these figuresunderstate the disparities since rural health facilities usually are simple clinics while urban facili- ties include hospitals with sophisticated equipment. ©) Wiserand senitation faclives: The rural. urban differences in the provision of water and sanitation sre even greater. The cover: age of the rural population iso the average less than half that of the urban population In seven countries the proportion of rural dwellers with access to water wasless than fifth of that in urban areas. In Nepal access to-sanitation facilities in urban areas was 17 times that in rural areis, and in Bean! the urban figure was as muchas 86 times higher than the rural igure + Income. In most countries, urban in comes per person run 34% to 106% higher than rival incomes. The differences are particulatly large in Affica. In Nigeria the average urban family income in. 1978-79 vwas4.6 times the rural. In Sierra Leone the average urban income was 4,1 times the agricultural income, And in Mexico urban, per capita income was 2.6 times the rural Ruralsucban income differences. remsinwide, even after taking into account the differences in the cost of living berween rural and urban areas, To sum up, national daia conceal Large ruraburban differences, with rural areas performing systematically worse on the basic indicators of human development. Part of the reason is less access to sei services, and partis lower income. More: ‘ver, the rural and urban figures hide large dlispar-ities within each area, These gaping ddisparitics have major policy implications for restructuring the social spending of ‘governments Fensaleswiale disparities Inmost societies, women fare less well than men, As children they have less access 10 cclucation and sometimestofood and health cae. As adults they receive less education and training, work longer hours for lower incomes and have few property rights or ane, Both women and men shared the prog ressin improving the human condition frm 1960 to 1980, In some fields women did ‘even better than men, but substantial ines quality remains. During the economic crisis of the 1980s, women had to bear a rhuch preater cost of structural adjustment, and gender disparities tended to widen once again. Moreover, national data usually conceal the true extent of inequality be- ween women and men (box 2.3). Discrimination against females starts carly, In many developing countries more girls than boys die between the ages of one and four, a stark contrast with the industrial countries, where deaths of boys are mote than 20% higher than those of gla. And in 30 developing countrics the death rotes for firls werehigher than or equal todeath rates for boys, indicating the sociocultural pate tems that discriminate against women. ‘The discrimination takes several forms. Young girls may not get the same health care and nutrition as young boys. In Bangladesh ‘malnutrition was found among 14% of the young gils, compared with 5% of the boss. Farnilies in India's rural Punjab spend more than twice as much on the medical care of male infants as on that of female infants. The same neglect is evident in exceed- ingly high macernal mortality rates, mainly because health staff are in attendance for fewerthan bulfthe births. Maternal mortal ity tates were 1,000 or mare (pex 100,000 tive births) in a few counssies, ancl 400 t0 1,000 in another 14 countries during 198 84. In developed countries, maternal mor- tality ates rarely exceed 20 and are usually lese than 10. No other North-South gap in human development is wider than that between maternal mortality rates, a symbol of the neglect of women's health in the Thind World Gender inequality is reinforced in edu- cation. There still are 16 developing coun- tries where female primary schoo! enrol- ment is less than two-thieds that of males. And 17 developing countries have female secondary enrolments lessthan half those of males. For thedeveloping world asu whole, the fernale literacy rate is now three-quat cersthat of the male. The gap hes narrowed slight in the last three decades, but much progress remains to be mede. ‘The soctal dividend from femaleliteracy tends ta be very high. Higher female lter- acyis associated with lnwer infant mort bette family nusition, reduced fesiliryand nGURE 2 Female literacy and population growth Female teaey “ate, 1285 10060604020 SELECTED COUNTRES Yemen Arab Rep. Afghanistan Mall Sudan Pakistan, Dominican Republic Jamaica Sri Lanka Colombia Thailandune 215 Female-mate Hteracy disparities Pocmtagy of tan ne 100 uran mate» 100 89) sa Usban ternate » 78 a Rural female = 35, » lower population growth rates. In Bangla- desh child morality was five times higher for children of mothers with no education than for those with seven oF more years of schooling. Berrer educated women alto have srnuller families, Colombian waren with the highest education had four fewer chil dren than women wheshad completed any theie prinury education, The consinuing dlsparity in male andl fernale education thus inilicts extremely high social and economic ‘eis in the developing world ‘Women ypically work about 2%longer hours than men: up 10 15 hours move a week in rural India and 12 hours more rural Nepal. Bur thetetotal remuneration is less because of their lower wage rate and their preponderance in agriculture and the turban informal sector, where pay tends 10 bbe less than in the res ofthe ecomomy. In turban Tanzania 50% of the women working are inthe informal sectot in utban Indone- sia 35% and in Peru 33%. “The persistence of female-male gaps in human development offers a challenge and an opportunity te the developing countries In every country having data. nthe kn formal sector, where most women work, ‘her earings wt times reac only «think (Malesia to a half (Latin Ametica) of shone of men. imate Dowunenremain invaible tes because lle value js attached m0 what they do? rea ‘Women have lage pare of the adjustment arden of ‘countries in the L980. To make up for — to accelerate their economic and social progress i the 1990 by investing more in dn order to monitor progress towards the elimination of existing within-country disparitics in human development, it would hhe desirable o have group and region-spe- sific HDIs. How telling such indices could be is illustrated in technical note 4, which discusses the construction of a gender-spe+ cific HDL. Similar indices could be devel- ‘oped to monitor other disparities of special interest in w particular country, whether it be those between various ethnic groups, different geographical areas, nural and ur ban or rich and poor Disparities betwen rich and poor Income gaps and human development paps are closely related in mox: developing soun- ties, which isonly natural since income isan imporiant eleterminantof people’successto social services. In some eases, however, governments have changed this pattern through very active interventions with their social sector budgets. They did this by taspetting their social spending and subs des specifically on the poorer sections of society — and by reducing the appropria tion of subsidies by higher income groups and vested power sucturce. “Two questions are of particular interest here. First, how do different income groups sliffer io terms of their human devclop- ment? Second, who benefits from govern- ment social expenditures, which in many ‘counties are said to aim at correcting the socioeconomic inequities resulting from the inequalities in the primary distnbution of ‘Several studies show thatthe poor have ‘very unequal access to social services and basic human development. Far instance: + In Brazil life expectancy in 1970 was barely 30years forthe bottom income group send 62 years for thowe with an income above $400. To put this in perspective, the ex- pected life span of the poor in Brazil wasn0 higher thanthe average in Trdia,even though Hews! saverage percanita income was about ‘ight times that of India + In Mexico a person's ife expectancy inthelowest income decile was 33 years inthe ‘early 1980s, 20 yeary less than the average life expectancyin the top income decile. + InColombiainfantsin poor families ure twice as likely to die as infants in the top incomedecile. + Inrural Punjab child mortality among the Landlessis 36% higher than among the land-oaning classes. * InaSouth Indinnvillage the literacy rate fn 1989 was 90% for Brahminsand 10% for people atthe lowerendof the caste hierar chy. + In Zimbabwe child malnutition was severewhenthe average family income was $91, mild at $168, and nonexistent at $230 and above. Such evidence emphastsestheneed for carchul monitoring of the beneficlaties of _rovernment spending tw ensure that it ee- duces rather than perpetuates inequalities, Ifthe state provides the goods an! ser- ‘vices essential forhuman development free coratlow cost—asinSiri Lanka inthe 1960s and 1970s — it can reduce the handicaps the poar face, But the free oF subsidised services may not reach many of the poor. ‘That can happen — as it did in Egypt — swhereonlyurban food is subsidised orurhan health services are provided. Information about social services may also be more a¢- cessiblctothe wealthier orbettercdcated, ‘who then manage to preempt the major benefit frormsuch services. Moreover, even free services have cost, Togain accessio health services orto axtenulschool, people have to pay transport costs, and thesime taken tousethe services has an opportunity cost, That is why very poot familiesoften keep their children out of school, especially at harvest time when farmlabouris needed most. ‘Not enoughtesearchharheendone on thedistribution of social benefitsbyincome group in developing countries, but +eat~ tered evidence shows that much soci spending often goes far projects and pro- sramines that subsidise therich more than the poor. ‘© Hospital spending in Latin America, primarily benefiting the urban nonpoor, tanged from 44% of total central gowern- ment expenditure on health in Guyana to HUMAN DEVELOPMENT SINCL bie 100% in E! Salvador. + In the Philippines in the early 19805, annual subsidies to private hospitals cater- toupper-income families exceeded the resqurces allocated to mass programmes (including malaria erudication and schis- tosamniasis) andto primary health care, + Indevelopingcountrics ava whole, ter- tiaty education covered about 8% of the populationbutabsorbed 73% the educ tion budgetin 1973, Thesest perstudentin xertiary education was24 times tht in pri smuryeducation A major conclusion from dence is that not all government spending -vorks in the interest of the poor and that great care must be taken in structuring social spendingto ensurethat benctitsalso flowtethem. Theveryrationale for gover: mentintervention crumbles socialexpen: ditures, far from improving the existing income distribution, aggravate it further — anissuethatistaken up at engthinchapters Sand 4 Looking at all three types of depriva- tion, another major conclusion isthat poor raratwememindeveloping countries suffer the gravest deprivation. Manyofthemare stililliterate. Their real incomes have not increased and in-some parts of the world haveeven fallen. Theirbieths are still unat- tended by health personnel, and they face a high risk of death during childbirth. They andzheirchildrenhave almostnoaccessto health cure ‘There arebetween 300 millionand one billion poor rural women, Forthem, there has been little progress over the past 30 years Reversibility of human development Human progressduring the 1960s and 1970s differed greatly from that in the 1980s Inthe late 1970s and ently 1980s, very large imbalanceshad developedin the cur- rentaccountof the balanceaf peymentsin many developing countries, The non-oil developing countries had a combined defi sit of $74 billion in 1980. Unlike the situ- ation in much of the 1970s, there was no voluntarybank leadingto financethedefi sits, Volumary lending dried up because For more than half @ billion poor rural women, there has been little progress over the past 30 years ”It is short-sighted to balance budgets by unbalancing the lives of the people FIGUEE 2.16 Debt of developing countries USS alions 1000 thesis was so widespread, affecting mote shan nwo-thirds of the countries af Latin ‘America and Subs Saharan Africa ac well as several Asian countries The ccanomics of most developing ‘countries slowed down inthe 1980s, except in Asia. Acutely affected by the exiss, they ‘expericnced a nearly continuous economic decline. and despite rigorous adjustment cfforts, hey were sill showing severe imbal- ances at the end of the 1980s inv 17 Latin American and Caribbean ‘niniries, pet capitaincome fellin the 1980s, ‘Average income per person in the region declined 7% between 1980 und 1988, and about 16% if account is taken of the deterio- ‘nating terms of trade and the resource out- flow, Net investment per eapita fel 50% bhetween 1980 and 1985. ln Alrica income per person declined ‘mare than 25% for the region ws a whale, 307% taking into acount the deteriora in the termsof trace. GDP did grow faster ‘in 1985-87 than during 1980-84, bur that gouth was sill lower than the growth in ‘population, and incomes per person fell at ‘oughly the same eate in countries with strong reform programmes ax in.counties ‘vith weak or ne reform programmes, In ‘yestment fell more than 9% « year, and per ‘capita consumption 1% to 2% a year ‘Much of Asia, by contmust wens not very seriously ulfected. Between 1980 and 1986 GDP percapitarose 20%in South Asiaand 1979 1995 a 50% in Southeast and East Asia, though some countries were badly hit, including the Philippines. Evidence of the effect of these see nomic changes on social conditionsis piece: meal because social data usually ere not collected regularly et short intervals, or reported onsystematically. Moreover, some social data— such as life expectancy — are penerated byextrapolating past trends, until ew empirical data, such as that from a population census, establishes a new trend, Few official statistics have thus begun 1 capture she efiects of the 1980s" economic crisis on human development. Judging from the piecemeal data that ‘exist, many developing countries have had. sharp breaks in their human development trends, and sometimes even reversals. ‘Countries in Africa and Lain America suf- fered the most adversity. In seven Latin American countries und sx Afican countries child malnutition ose at some time in the 1980s. In two-thirds of | the Latin American countries forwhich data aredvallable, the progress in reducing infant ‘mortality rates slowed of reversed — as it did in 12 of 17 African countries. Many households lost purchasing power and were leftwithincomes grossly inadequate tomeet ‘minimum food needs. + InGhanain 1984 even upper-levelciil servants could only afford toro-thinds of the least-cost diet to meet nutitioaal needs, A two-wageceamer houschold receiving the minimum wage could afford less than 10% of such a dict, © InUgandsin 1984 anaverage-size urban family nceded 4.5 times the minimum wage te mect its minimum food requirements, * InDaresSalaamin the mid- 1980s, 58% of the women surveyed in low-income hhoutcholds reported that they had beca forced to cut down from three meals a day to two, and 61% had reduced their con: sumption of protein-rich foods. ‘+ Tn Jamaica in 1986 a family of four needed two to three times the minimum ‘wage to hurveaccesstothe minimum accept able nutition. In many instances, high inflation, rising food prices, stagnant formal employmentand curtailed government subsidies con- vverged to push household incames down Latin America is estimated to have had 4 raillion fewer new jobs in 1980-85 than it ‘would have had under previous trends — and its unemployment grew morethan 6% a year. Africa had an annual increase in unemployment of 10% during the sume period “According tol Oestimates, wage earn: ers huve borne the brunt of the economic crisis, with real wages having beeneut back severely. In Africa and Latin America, wage ccutsof athird va half were not exceptional Between 1920und the mid-1980s, real wages fell 0%in Peruand Bolivia, 30% in Mexico and Guatemala, and 25% in Venezuela The sharcof labour income in the region's GNP declined by 25% between 1980 and 1987, In Alftica, too, real wages fell more rapidly than income per person during the ‘irsthalf of the 1980s. ‘Rapid risesin food prices compounded the damage from falling real incomes. In ‘many countries food pricesrose fasterthan sother pricesbecause of reduced food subs dies, higher producer prices, decontrolled ‘consumer prices and devalued currencies, Food subsidies fell rom 1980 to 1983 in ‘each of 10 countries examined in detail, Food price rises exceeded the general cost oflivingin five of six UNICEF case studies. And mote than halfthe countries receiving World Bank structural adjustment loans had the availabilty of food per cupita de» clineas apercentage ofrequirements from 198000 1987 The declines in government spending on socialservices gencrallyimpaired hniman developmentin the 1980s. Social spending was not cut disproportionately more than total spending, bur real government spend ing per person declined in around two thirds of the councriesof Africa and Latin America, in some cates considerably. Madagascar’steal soctal spending perper- son fell 44% (during 1980-84), Seneqtl's 448% (1980-85) and Somalia's 62% {1980 86), In Zambia the real valuc of the drug budgetin 1986 was acquarterofthasin 1983, and only 10% of the budger was spent because of shortages of foreign exchange. In Bolivia central government health ex- pendivure per personin 1984 waslessthan 30% of that in 1980. ‘The worsening of social conditions was far from uniform. Some countries pro tected the most vulnerable groups from the dowrevard pressures, Zimbabwe, Botswana, Gosta Rica, Chile and the Republicof Korea managed to adjust and protect the human condition, but these arecountries that have done consistently well in human develop: ment (box 2.4). Moreover, many of them have well-established capacities for plan ning and managing nationallevelopment. ‘Thecountriesthat protectedvulnerable ing the adjustments of the 1980s © Some countries avoided excessively deflationary macroeconomic policies and thus managed to maintain incomes and ‘employment, The Republicof Korea and ‘Adjasemene with a human | ‘in 1980, H launched 4 sexics of (gammes in heath, efocation and theWithout some end ta the debt crisis, the impressive human achievemenis recoriied-sa far may soon be lost Zimbabwe adopted less deflationary ad- justment palicies than were typical * Some launched special employment schemes to maintain the incomes of low- income households, Chile undertook mas- sive publie warks programmes, which were one time employing as much ay 13% of the work force. Zimbabue diverted sub- stantial amounts of credit to smallholder fareaers. + Somedirected special nutrition support to the neediest. In Botewans and Chile, infants and children were carefully moni- tored, and food aad other support was supplied asneces + Some protected neal expenditures on Priority services in the social sector, Zim- babwe greatly increased spending an pri- mary education and primary health care, ‘cutting back on defence. Many countries supportedlow-cor and high: priority mess ures despite overalleuthacksinexpenditure — and made progress in extending im ‘A general feanure ofthe successful cou: tries wastheir careful and systematic moni- toring of human and economic variables, Good and up-to-date statisticson what was happening provedessential forappropriate andtimely poticyaction, Although many countries maintained their human development levels aver this difficult period by redirecting resources towards priority areas — und indeed contin. ued their progress in reducing infant and child mortality rates — it was stear that continuingeconomic decline would make suchefforts increasingly difficult, Despite itseconomic problems, Jamaica maintained support for human develapment through: ‘outthe 19706, but stabilisation progracnimes in the 1980s severely cut social spending, and there hasbeen evidence of halts snd even reversalsin some human indicators, Resumed evonomie growth isthuses: sential io allow the expansion of incomes, employment and government spending needed for human development inthe long: run. Without some end to the continuing. debtand farcign exchangecrisisin muchot Africa and Latin America, the impressive human achievements recorded so farmay 008 be lost. ‘Deformation ofhuman development ‘Human development is fragile. Econom slowdowns and theirconsequences — fall. ingincome, Qaggingemployment, plunging ‘wages and deep curs in social spending — ‘can quickly reverse progress. ‘Thistraglitys not limited to developing ‘countries of tecconomic recessions. In the United States the number of homeless people bas risen tremendously in the past years. And in the United Kingdom the distributionof income —whether original, posable or final income — warsened during the 1980s, leadingtoadeepening of poveny. ‘Losses of human development gains muy stem from the development path a country pursues, for developseet is far from anidiectional. Technological advance: ment has given a tremendous impetus to production and eased human life in inaw- ierableways. But ithasalso brought indus trial pollution. The growing density of the transportnetworkenhanced people's geo- ruphical mohility and access to develop- mentalopporunities, Ithasalsoentailed environmental degradation. ‘The point isthatdevelopmenchascesir- ableand undesirable effects. And people must be uble to make informed choices shout the weightthey assign tothe prosand cans. Istobacco-smoking worth thesisk of Jung cancer? Is high speed on highways worth the deaths and disabilities it costs cach year? What are chemical ferilizer's tradeoffs between increased agricultural production and polluted waterrescurces? Such questions havenoreasy ‘Many countries have seen more and siote lives destroyed by rising crime, drug abuse, environmental pollution, family breakup and political turmoil, And now shereisa new majorthreat to hurnas life — the acquired immune deficiency syndrome (AIDS) Developmentand crime ‘The telationshipbetweencrime anddevel- opment iscomplex. Rapid socioeconomic change—aften entailing dramatic conse- quencesforpeople’slifestyles and the crum- UALS DaVELOPMEbling of traditional norms and values, but also sharp economic and social inequities — ‘muylead to an increasein crime. Criminal activity, in turn, can further worsen the societal imbalances by destroying human lives and encouraging drug use. Perhaps ‘wore, it makes people feel vulnerable and insecure, depriving them of dignity and ‘optimism, Property crime increases with higher levels ofdevelopment. Therclationship for other types of crimeislessconclasive, but it is known that the developing countries’ reported homicideand assault rates exceed those of developed countries, while the everse is true for theftsand frauds For nine Western European countries the frequency of street crimes more than doubled between 1960 and 1980, From 1975 to 1980 the greatest increase was in drug crimes, which increased more than 10> ‘fold globally, with increases for individual ‘countries between 5% and 400% aear, ‘Crime apparently pays, Criminals are ‘becoming more technicallyexperiencedand ‘better organised, often with vast interna tional operations and eannections, ‘The proceeds from organised crtminal activity mount tbillions of dollars, outstripping the GNP of manycountries. But crimealso. imposes costs, for the frequentresponseto growing crime has been a large increase in police forces, in bothdevelopedand devel. oping countries, syphoning off resources thateould otherwise be available for devel opment purposes. Tiredrggtrade The sc afillict drugs threatens the health and well-being of manymillionsaf people in bothdeveloped and developing countries. Possibly even greater harm comes from productionand matketing, The enormous illegal profitsin producing and usingcoun- tries criminalisex society, corrupts aw en- forcersand brings politcal violenceto coun- triesand military confliets between them. ‘More than 2million people arcdirectly explored in drug production and trade, contributes much to the economies: " drug-producing nations. Returns per hectare from growing narcotic crops in Latin America are 010 20timesthose from|egal ‘crops. Yet the producers receive cnt fractioaof the street price see '% muchas 120timesthe producti Drug abuse and tracking dof m mea. surement, buttheyare known tebe increas: ing sharply. The cocaine seized between 1980 and 1985 increased more than four- fold,and the heroin sevenfold, WHO esti- mates that 48 million people worldwide regularly usedillcit drogsin 1987 —among them 30 millioncannabisusers, 1.6 million cova-leaf chewers, 1.7 million opium ad- dicts and 047 million heroin addicts. The value oftradeinillegal dragsexeceds thatof world trade in oil and is surpassed only by the trade inarms. Drug users are a third less productive than nonusers, three timesmore likely tobe involvedin accidents on the joband rwiceas often absentfromwork. Drugabuse during pregnancy meuns more miscarriages and infant deaths — and lower birth weights tand mental achievements for the children. thut survive, with the babies of drag abusers often born as addicts, Intravenous drug takers also riskand promote the spread of AIDS. Drug abuse imposes growing costs on. drug users and their families, on govern ‘ments for prevention, rehabilitation, medi- caland enforcement programines,and on society forlos ourputand heightened vio- lence, The United Statesalone spent $2.5 billionin 1988forlaw enforcement against drug production and trafficking. Falling drug prices suggest, however, that these efforts arefar from effective. Arcemprs to control drugs have failed because the incentives for producers and traffickers and the demand pressures from ‘consumersare far too strong. So, the battle continues to be lost at very heavycosts, Tamas Yoal and 1983 thon) Dep 1980, 85. Greabaher Smee Cannas rein m2 ‘60 Gansta lit ' 1 cocaine W 8 ‘heron 2 18 pum st a The value of trade in iegal drugs exceeds that of trade in oil and is surpassed only by the trade in arms 0