HUMAN DEVELOPMENT INDEX
WHAT IS HDI?
• The Human Development Index (HDI) is a statistic composite index of
life expectancy, education, and per capita income indicators, that was
introduced in the first Human Development Report 1990, as an alternative to
the purely economic assessments of national progress , such as GDP growth.
• The HDI is a measure of economic development and economic welfare.
• It is a tool used to measure a country’s overall achievement and economic
dimensions
• Moreover, this index is used to rank countries into four tiers of
human development A country scores a higher HDI when the lifespan is
higher, the education level is higher, and the gross national income
GNI (PPP) per capita is higher.
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ORIGIN OF HDI
• The concept of human development was first introduced by Pakistani
economist Mahbub ul Haq in 1990 and had the explicit purpose "to shift
the focus of development economics from national income accounting to
people-centered policies".
• He has described human development as development that enlarges
people’s choices and improves their lives.
• Dr. Haq and Amartya Sen worked upon the capabilities and functioning
which provided conceptual framework,
• Which was further used to measure a country's development by the
United Nations Development Programme (UNDP)'s Human Development
Report Office
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DIMENSIONS AND INDICATORS
(note: new method published on 4th november 2010, in old method indicators are
slightly different) please check slide no 7 4
• Life expectancy at birth: Number of years a newborn infant could expect
to live if prevailing patterns of age-specific mortality rates at the time of
birth stay the same throughout the infant’s life.
• Mean years of schooling: Average number of years of education received
by people ages 25 and older.
• Expected years of schooling: Number of years of schooling that a child of
school entrance age can expect to attend (school, or university, including
the years spent on repetition) if prevailing patterns of age-specific
enrolment rates persist throughout the child’s life
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CALCULATION OF HDI
1. Life Expectancy Index (LEI) = (LE-20)/ (85-20)
LEI is 1 when life expectancy at birth is 85 and 0 when life expectancy at birth is 20.
[Link] Index (EI) = (MYSI + EYSI) /2
(i). Mean Years of Schooling Index (MYSI) = MYS /15
fifteen is the projected maximum of this indicator for 2025.
(ii) Expected Years of Schooling Index (EYSI) EYS /18
Eighteen is equivalent to achieving a master’s degree in most countries.
3. Income Index (II) = ln (GNIpc)-ln(100) / ln(75,000)-ln(100)
II is 1 when GNI per capita is $75,000 and 0 when GNI per capita is $[Link], the
HDI is the geometric mean of the previous three normalized indices:
HDI = 3
LEI * EI* II
The value of HDI can vary between 0 and 1, with the HDI score close to 1 indicating
greater achievement relative to the maximum attainable on the aggregate of the
factors entering the HDI, and vice-versa
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Old method (before 2010 Index)
• The HDI combined three dimensions last used in its 2009 Report:
• Life expectancy at birth, as an index of population health and longevity to
HDI
• Knowledge and education, as measured by the adult literacy rate (with
two-thirds weighting) and the combined primary, secondary, and tertiary
gross enrollment ratio (with one-third weighting).
• Standard of living, as indicated by the natural logarithm of gross domestic
product per capita at purchasing power parity.
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INTERNATIONAL COMPARISONS
• Often smaller countries have done better than the larger ones in human
development.
• Similarly, relatively poorer nation have ranked higher than richer
neighbours in terms of HDI
• For example Srilanka, trinado and tobago have a higher ranking than India
in the human development index despite having smaller economies.
• Similarly, within India, Kerala performs much better than Punjab abd
Gujarat in HDI despite having lower per capita income
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• Globally countries are divided in the following four classes
according to their score in HDI-
Level of human Score in Number of Name of few
development Development countries (as per Countries (2018
Index 2018 HDI report) report)
Very high Above 0.800 59 Norway (0.95)
Switzerland (0.94),
Australia (0.93),
High Between 0.700 up 53 Serbia (0.799)
to 0.799 Srilanka (0.780)
Thailand (0.765)
Medium Between 0.555 up 39 India (0.647)
to 0.699 Bangladesh (0.614)
Pakistan (0.560)
Low Below 0.554 38 Syria (0.549)
Nigeria(0.534)
Afghanistan (0.496)
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Trends in the HDI
The top five countries in the global HDI ranking are Norway (0.953),
Switzerland (0.944), Australia (0.939), Ireland (0.938) and Germany (0.936)
The bottom five are Burundi (0.417), Chad (0.404), South Sudan (0.388), the
Central African Republic (0.367) and Niger (0.354)
The largest increases in HDI rank between 2012 and 2017 were for Ireland,
which moved up 13 places, and for Botswana, the Dominican Republic and
Turkey, which each moved up 8.
The largest declines were for the Syrian Arab Republic (down 27), Libya (26)
and Yemen (20)
In allmost three decades, all regions and human development groups have
made substantial progress.
The global HDI value in 2017 was 0.728, up about 21.7 percent from 0.598
in 1990
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CONT…..
Across the world, people are living longer, are more educated and have greater
livelihood opportunities.
The average lifespan is seven years longer than it was in 1990, and more than
130 countries have universal enrolment in primary education.
Although HDI values have been rising across all regions and human
development groups, the rates vary significantly.
South Asia was the fastest growing region over 1990–2017, at 45.3 percent,
followed by East Asia and the Pacific at 41.8 percent and Sub-Saharan Africa at
34.9 percent.
The Organisation for Economic Co-operation and Development (OECD)
countries, by contrast, grew 14.0 percent.
The trends hold promise for reducing gaps in human development across
regions. But HDI growth has also slowed in all regions, particularly in the last
decade.
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REASONS FOR SLOW HDI GROWTH
[Link] due to 2008–2009 global food, financial and economic crises.
[Link] because- human progress advances, given the growth ceilings of
different components of the HDI—as seen with OECD countries. For instance-
(i). There is a biological limit to life expectancy, and years of schooling and rates
of enrolment cannot grow indefinitely.
(ii). Income is the only component of the HDI that could continue to grow; but
even income growth slows as economies mature.
So that, as more countries reach the upper limits of HDI dimensions,
measures of the quality of human development become more central.
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Progress since 1990 has not always been steady. Some countries suffered reversals
due to conflicts, epidemics or economic crises.
For example, many countries in Eastern Europe and Central Asia saw their HDI values
fall in the 1990s due to the collapse of the Soviet Union and to military conflict,
hyperinflation and a painful introduction (or expansion) of market mechanisms.
Sub-Saharan Africa also had losses in the 1990s, when conflict and the HIV/AIDS
epidemic caused life expectancy to drop dramatically. Which however went from the
second slowest growing region on the HDI in the 1990s to the fastest growing between
2000 and 2010.
Between 2012 and 2017 Libya, the Syrian Arab Republic and Yemen had falling HDI
values and ranks—the direct effect of violent conflict.
Overall, there have been significant advances in human development over the past
few decades, especially in low human development countries, up 46.6 percent on the
HDI since [Link] some countries have suffered serious setbacks—sometimes erasing
in a few years the gains of several decades.
However the gaps in human development across countries, while narrowing, remain
huge..
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PLEASE CHECK THE PDF
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