History of the Human Development index, and its major strengths and weaknesses

Summary

In this discussion, Salim Jehan, director of the Human Development Report Office at the United Nations Development Programme, reflects on the launch of the first Human Development Report in 1990. He emphasizes the need for people-centered development, moving beyond economic opulence to focus on human well-being. The Human Development Index (HDI) is highlighted as a measure of human capabilities and functioning, with strengths in its simplicity and ability to be disaggregated for a more nuanced view of development. However, Jehan also acknowledges the HDI's weaknesses, such as its composite nature, reliance on stock variables, and equal weighting of dimensions, which can raise ethical questions about substitutability.

Takeaways

• 🌐 The Human Development Report (HDR) was launched in 1990 by the United Nations Development Programme (UNDP) to shift the focus of development from economic growth to people-centered development.
• 📈 The Human Development Index (HDI) was introduced as a measure of human well-being that goes beyond economic indicators like GDP per capita.
• 🔄 The motivation behind the HDR was to address the shortcomings of the prevailing development indicators that ignored the human aspect of development.
• 🌱 The HDR aimed to bring a new economic paradigm that prioritizes human life and well-being over structural adjustments that often hurt people.
• 🏆 The HDI is considered the 'crown jewel' of the HDR and is based on the capability approach by Amartya Sen, focusing on the freedom to choose the life one values.
• 📊 The HDI measures 'functionings', which are the things people value doing or being, such as a long and healthy life, knowledge, and a decent standard of living.
• 🔑 The HDI is simple and straightforward, making it accessible to policymakers and the public, which enhances its value and credibility.
• 🔄 The HDI allows for experimentation with different indicators to reflect its dimensions, as seen in many National Human Development Reports.
• 💪 The HDI is a powerful advocacy tool used by civil society organizations to influence government policies and expenditure patterns.
• 🔎 The HDI can be disaggregated to reveal disparities between different groups such as men and women, regions, ethnic groups, and races, providing a more nuanced view of development achievements.
• ⚖️ The HDI has its weaknesses, including being a composite index which can be less robust and predictable, and the use of stock variables that change slowly over time.
• 📝 The HDI gives equal weight to different dimensions, which might not reflect the true hierarchy of choices and values in society.

Q & A

What was the historical context behind the launch of the first Human Development Report by UNDP in 1990?

In 1990, there was a focus on structural adjustment in Africa and Asia, which negatively impacted people's lives. Additionally, the economic growth paradigm was dominant, leading to a shift towards a new economic paradigm that prioritized people at the center of development. The Human Development Report emerged to promote people-centered development.

What was the motivation behind the introduction of the Human Development Index (HDI)?

The motivation for introducing the HDI was to shift the focus from purely economic indicators like GDP per capita to a broader measure of human well-being. It aimed to capture the real wealth of a nation, which is its people, and to ensure development was for and by the people.

How does the Human Development Index reflect Amartya Sen's capability approach?

The HDI reflects the capability approach by measuring functionings, which are the things people value doing or being, such as a long and healthy life, knowledge, and a decent standard of living. Functionings are a proxy for capabilities, representing the freedom to choose the life one values.

What are some strengths of the Human Development Index?

The HDI has several strengths: it is a broader measure of human well-being beyond income per capita, it is simple and easy to understand, its methodology is straightforward allowing for experimentation with different indicators, it can be used for advocacy purposes, and it can be disaggregated to reveal disparities among different groups within a society.

What are the possible shortcomings of the Human Development Index?

Some shortcomings of the HDI include its nature as a composite index which can be less robust and predictable, the inclusion of stock variables that change little over time, and the equal weighting of different dimensions which may not reflect the true hierarchy of societal or individual values.

How does the HDI address the issue of equal weighting of dimensions?

The HDI currently assumes equal weighting of dimensions, which is a starting point for the index. However, this assumption may not hold true in all situations, as different societies and individuals may value these dimensions differently. The index avoids the complexity of variable weighting by using this assumption.

Why is the Human Development Index considered a simple measure?

The HDI is considered simple because it is easy to explain and understand, even by policymakers and the general public. This simplicity does not detract from its value or credibility, making it an effective tool for communication and advocacy.

How can the Human Development Index be used for advocacy purposes?

The HDI can be used by civil society organizations to advocate for changes in government policies and expenditure patterns. By highlighting disparities and areas of improvement, the index can pressure governments to take action towards better human development outcomes.

What is the significance of the HDI's ability to be disaggregated?

The ability to disaggregate the HDI allows for a more nuanced understanding of human development achievements within a country. It can reveal disparities between different regions, ethnic groups, genders, and other demographics, providing a clearer picture of where improvements are needed.

How does the HDI handle the issue of substitutability in its composite index?

The HDI does not explicitly address the issue of substitutability, which raises ethical questions about the value placed on different aspects of human development. The index treats all dimensions equally, which may not accurately reflect the trade-offs that individuals or societies might make.

What are stock variables and why are they a weakness in the HDI?

Stock variables are indicators that measure a stock or accumulated value rather than a flow or ongoing change. In the context of the HDI, stock variables like life expectancy may not reflect recent policy changes or improvements in living conditions, as they change slowly over time.