# Human Development Index

World map indicating Human Development Index (2008 Update)
 0.950 and over      0.900–0.949      0.850–0.899      0.800–0.849      0.750–0.799 0.700–0.749      0.650–0.699      0.600–0.649      0.550–0.599      0.500–0.549 0.450–0.499      0.400–0.449      0.350–0.399      under 0.350      not available
(Color-blind compliant map) For red-green color vision problems.
High income      Upper-middle income      Lower-middle income      Low income

The Human Development Index (HDI) is an index used to rank countries by level of "human development", which usually also implies to determine whether a country is a developed, developing, or underdeveloped country.

## Summary

The HDI combines normalized measures of life expectancy, literacy, educational attainment, and GDP per capita for countries worldwide. It is claimed as a standard means of measuring human development—a concept that, according to the United Nations Development Program (UNDP), refers to the process of widening the options of persons, giving them greater opportunities for education, health care, income, employment, etc. The basic use of HDI is to measure a country's development.

The index was developed in 1990 by Pakistani economist Mahbub ul Haq, Sir Richard Jolly, with help from Gustav Ranis of Yale University and Lord Meghnad Desai of the London School of Economics. It has been used since then by UNDP in its annual Human Development Report. It is claimed that ideas of Indian Nobel prize winner Amartya Sen were influential in the development of the HDI. The HDI now serves as a path towards a wide variety of more detailed measures contained in the Human Development Reports.

The HDI combines three basic dimensions:

From the time it was created, the HDI has been criticized as a redundant measure that adds little to the value of the individual measures composing it; as a means to provide legitimacy to arbitrary weightings of a few aspects of social development; and as a number producing a relative ranking which is useless for inter-temporal comparisons, and difficult to interpret because the HDI for a country in a given year depends on the levels of, say, life expectancy or GDP per capita of other countries in that year.[1][2][3][4] However, each year, UN member states are listed and ranked according to the computed HDI. If high, the rank in the list can be easily used as a means of national aggrandizement; alternatively, if low, it can be used to highlight national insufficiencies. Using the HDI as an absolute index of social welfare, some authors have used panel HDI data to measure the impact of economic policies on quality of life.[5]

An alternative measure, focusing on the amount of poverty in a country, is the Human Poverty Index.

## Methodology

 Central and eastern Europe, and the CIS      Latin America and the Caribbean

In general, to transform a raw variable, say x, into a unit-free index between 0 and 1 (which allows different indices to be added together), the following formula is used:

• x-index = $\frac{x - \min\left(x\right)} {\max\left(x\right)-\min\left(x\right)}$

where $\min\left(x\right)$ and $\max\left(x\right)$ are the lowest and highest values the variable x can attain, respectively.
= vlookup = = = =

The Human Development Index (HDI) then represents the average of the following three general indices:

• Life Expectancy Index = $\frac{LE - 25} {85-25}$
• Education Index = $\frac{2} {3} \times ALI + \frac{1} {3} \times GEI$
• GDP Index = $\frac{\log\left(GDPpc\right) - \log\left(100\right)} {\log\left(40000\right) - \log\left(100\right)}$

## 2008 statistical update

A new index was released on December 18, 2008. This so-called "statistical update" covers the period up to 2006 and was published without an accompanying report on human development. The update is relevant due to newly released estimates of purchasing power parities (PPP), implying substantial adjustments for many countries, resulting in changes in HDI values and, in many cases, HDI ranks.[6]

 Iceland 0.968 (▬)  Norway 0.968 (▬)  Canada 0.967 (▲ 1)  Serbia 0.965 (▼ 1)  Ireland 0.960 (▬)  Netherlands 0.958 (▲ 3)  Sweden 0.958 (▼ 1)  Japan 0.956 (▬)  Luxembourg 0.956 (▲ 9)  Switzerland 0.955 (▼ 3) France 0.955 (▼ 1)  Finland 0.954 (▼ 1)  Denmark 0.952 (▲ 1)  Austria 0.951 (▲ 1)  United States 0.950 (▼ 3)  Spain 0.949 (▼ 3)  Belgium 0.948 (▼ 1)  Greece 0.947 (▲ 6)  Italy 0.945 (▲ 1)  New Zealand 0.944 (▼ 1) United Kingdom 0.942 (▼ 5)  Hong Kong 0.942 (▼ 1)  Germany 0.940 (▼ 1)  Israel 0.930 (▼ 1)  South Korea 0.928 (▲ 1)  Slovenia 0.923 (▲ 1)  Brunei 0.919 (▲ 3)  Singapore 0.918 (▼ 3)  Kuwait 0.912 (▲ 4)  Cyprus 0.912 (▼ 2)

### Countries not included

The following nations are not ranked in the 2008 Human Development Index, for being unable or unwilling to provide the necessary data at the time of publication.

 Africa Asia Europe Oceania

## 2007/2008 report

The report for 2007/2008 was launched in Brasilia, Brazil, on . Its focus was on "Fighting climate change: Human solidarity in a divided world."[7] Most of the data used for the report are derived largely from 2005 or earlier, thus indicating an HDI for 2005. Not all UN member states choose to or are able to provide the necessary statistics.

The report showed a small increase in world HDI in comparison with last year's report. This rise was fueled by a general improvement in the developing world, especially of the least developed countries group. This marked improvement at the bottom was offset with a decrease in HDI of high income countries.

A HDI below 0.5 is considered to represent "low development". All 22 countries in that category are located in Africa. The highest-scoring Sub-Saharan countries, Gabon and South Africa, are ranked 119th and 121st, respectively. Nine countries departed from this category this year and joined the "medium development" group.

A HDI of 0.8 or more is considered to represent "high development". This includes all developed countries, such as those in North America, Western Europe, Oceania, and Eastern Asia, as well as some developing countries in Eastern Europe, Central and South America, Southeast Asia, the Caribbean, and the oil-rich Arabian Peninsula. Seven countries were promoted to this category this year, leaving the "medium development" group: Albania, Belarus, Brazil, Libya, Macedonia, Russia and Saudi Arabia.

On the following table, green arrows () represent an increase in ranking over the previous study, while red arrows () represent a decrease in ranking. They are followed by the number of spaces they moved. Blue dashes () represent a nation that did not move in the rankings since the previous study.

 Iceland 0.968 (▲ 1)  Norway 0.968 (▼ 1)  Australia 0.962 (▬)  Canada 0.961 (▲ 2)  Ireland 0.959 (▼ 1)  Sweden 0.956 (▼ 1)  Switzerland 0.955 (▲ 2)  Japan 0.953 (▼ 1)  Netherlands 0.953 (▲ 1)  France 0.952 (▲ 6) Finland 0.952 (▬)  United States 0.951 (▼ 4)  Spain 0.949 (▲ 6)  Denmark 0.949 (▲ 1)  Austria 0.948 (▼ 1)  Belgium 0.946 (▼ 4)  United Kingdom 0.946 (▲ 1)  Luxembourg 0.944 (▼ 6)  New Zealand 0.943 (▲ 1)  Italy 0.941 (▼ 3) Hong Kong 0.937 (▲ 1)  Germany 0.935 (▼ 1)  Israel 0.932 (▬)  Greece 0.926 (▬)  Singapore 0.922 (▬)  South Korea 0.921 (▬)  Slovenia 0.917 (▬)  Cyprus 0.903 (▲ 1)  Portugal 0.897 (▼ 1)  Brunei 0.894 (▲ 4)

### Countries not included

The following United Nations member states are not ranked in the 2007 Human Development Index, for being unable or unwilling to provide the necessary data at the time of publication.

 Africa Asia Europe Australia and Oceania

## 2009 report

The 2009 report —to be launched in October 2009— will deal with the issue of migration.[8]

## Past top countries

The list below displays the top-ranked country from each year of the index. Canada has been ranked the highest eight times, followed by Norway at six times. Japan has been ranked highest three times and Iceland twice.

### In each original report

The year represents when the report was published. In parentheses the year for which the index was calculated.

 2008 (2006)– Iceland 2007 (2005)– Iceland 2006 (2004)– Norway 2005 (2003)– Norway 2004 (2002)– Norway 2003 (2001)– Norway 2002 (2000)– Norway 2001 (1999)– Norway 2000 (1998)– Canada 1999 (1997)– Canada 1998 (1995)– Canada 1997 (1994)– Canada 1996 (1993)– Canada 1995 (1992)– Canada 1994 (????)– Canada 1993 (????)– Japan 1992 (1990)– Canada 1991 (1990)– Japan 1990 (????)– Japan

### 2008 revision

The 2008 Statistical Update calculated HDIs for past years using a consistent methodology and data series. They are not strictly comparable with those in earlier Human Development Reports. The index was calculated using data pertaining to the year shown.[6]

 2006– Iceland 2005– Iceland 2004– Norway 2003– Norway 2000– Norway 1995– Norway 1990– Canada 1985– Canada 1980– Norway

## Criticisms

The Human Development Index has been criticized on a number of grounds, including failure to include any ecological considerations, focusing exclusively on national performance and ranking, and not paying much attention to development from a global perspective. Two authors claimed that the human development reports "have lost touch with their original vision and the index fails to capture the essence of the world it seeks to portray".[9] The index has also been criticized as "redundant" and a "reinvention of the wheel", measuring aspects of development that have already been exhaustively studied.[10][11] The index has also been criticized for having an inappropriate treatment of income, lacking year-to-year comparability, and assessing development differently in different groups of countries.[12]

Some authors have proposed alternative indices to address some of the index's shortcomings.[13]

## References

1. ^ Rao VVB, 1991. Human development report 1990: review and assessment. World Development, Vol 19 No. 10, pp. 1451–1460.
2. ^ McGillivray M. The Human Development Index: Yet Another Redundant Composite Development Indicator? World Development, 1991, vol 18, no. 10:1461-1468.
3. ^ Hopkins M. Human development revisited: A new UNDP report. World Development, 1991. vol 19, no. 10, 1461-1468.
4. ^ Tapia Granados JA. Algunas ideas críticas sobre el índice de desarrollo humano. Boletín de la Oficina Sanitaria Panamericana, 1995 Vol 119, No. 1, pp. 74-87.
5. ^ Davies, A. and G. Quinlivan (2006), A Panel Data Analysis of the Impact of Trade on Human Development, Journal of Socioeconomics
6. ^ a b News - Human Development Reports (UNDP)
7. ^ HDR 2007/2008 - Human Development Reports (UNDP)
8. ^ HDR 2009 - Human Development Reports (UNDP)
9. ^ Ambuj D. Sagara, Adil Najam, "The human development index: a critical review", Ecological Economics, Vol. 25, No. 3, pp. 249-264, June 1998.
10. ^ McGillivray, Mark, "The human development index: yet another redundant composite development indicator?", World Development, Vol. 19, No. 10, pp. 1461-1468, Oct. 1991.
11. ^ T.N. Srinivasan "Human Development: A New Paradigm or Reinvention of the Wheel?", American Economic Review, Vol. 84, No. 2, pp. 238-243, May 1994.
12. ^ Mark McGillivray, Howard White, "Measuring development? The UNDP's human development index", Journal of International Development, Vol. 5, No. 2, pp. 183-192, Nov, 2006.
13. ^ Farhad Noorbakhsh, "The human development index: some technical issues and alternative indices", Journal of International Development, Vol. 10, No. 5, pp. 589 - 605, Dec. 1998.