human development index; components of human development index, significance and limitations

Human Development Index

6/26/2017 Palistha Sainju 1



HUMAN DEVELOPMENT INDEX (HDI)

• PRESENTED BY: PALISTHA SAINJU


Development

The process in which someone orsomething grows or changes and becomesmore advanced : healthy growth and development .

The process of developing something new.



Human development

Human development is defined as the process ofenlarging people's freedom allowing them to lead ahealthy life, having decent standard of improved livingand guaranteed human rights.

It values capabilities related to health, education, longlife nutrition as ends in its self and it sees income as themeans to achieve these.



What is Human Development index?

• It is a summary composite, statistic index that measures acountry's average achievements in three basic aspects ofhuman development: health, knowledge, and a decentstandard of living which are used to rank countries intofour tiers of human development.



THE HUMAN DEVELOPMENT CONCEPT

Human Development is a development paradigm that isabout much more than the rise or fall of national incomes.People are the real wealth of nations.

HDI It is an index used to rank countries by level of humandevelopment which implies that whether the country is adeveloped, a developing or an underdeveloped, and also tomeasure the impact of economic policies on quality of life.


Human Development IndexThe origin of HDI

Mahbub ul Haq Founder of the Human Development Report.

UNDPs Human Development Reports (HDRs). These werelaunched in 1990 and had the explicit purpose: ‘‘to shift thefocus of development economics from national incomeaccounting to people centered policies.’’

It was Amartya Sen’s work on capabilities and functioning thatprovided the underlying conceptual framework.



Components of HDI



Health

Health is measured is measured by life expectancy at birth.

Life expectancy at birth is number of years a new borninfant could expect to live if prevailing patterns of agespecific mortality rates at the time of birth stay the samethrough out the infant’s life.

The life expectancy at birth component of Hdi is calculatedusing minimum value of 20 years and maximum value at 85years.



Education

The education component of HDI is measured by the meanof years of schooling for adults aged 25 years and expectedyears of schooling for children of school entering age.

Knowledge and education, as measured by the adultliteracy rate (with two-thirds weighting) and the combinedprimary, secondary, and tertiary gross enrollment ratio (withone-third weighting).



Standard of living

Standard of living is measured by the natural logarithm ofgross domestic product (GDP) per capita at purchasingpower parity (PPP) in United States dollars.

Gross national income(GNI) per capita: Aggregate incomeof an economy generated by its production and itsownership of the factors of production, less the income paidfor the use of factors of production owned by the rest of theworld, converted to international dollars using PPP ratesdivided by the midyear population.



Changes occurred in new Human Development Index (HDI)

1. There is a change of goalposts in three indices of HDI.2. Geometric mean is taken for assessment of HDI.

Changes occurred in Life Expectancy Index (LEI) in new HDI calculation

As per old HDI, the minimum life expectancy was 25 years. In new HDI, the minimum life expectancy is reduced to 20 years. As per old HDI, the maximum life expectancy was 85 years. And now maximum life expectancy is reduced to 83.5 years. The formula to calculate the LEI is same given in old HDI.



Changes occurred in Education Index (EI) in new HDIcalculation

As per old HDI, there were two indices named Adult LiteracyIndex (ALI) and Gross Enrolment Index (GEI). As per newHDI, these are replaced by Minimum Years of School Index(MYSI) and Expected Years of Schooling Index (EYSI).MYSI is given minimum value as zero and maximum value as13.2 and EYSI is given minimum value of zero and maximumvalue as 20.6. For total education index minimum value is setas zero and maximum value is set as 0.951. The formula ischanged for calculation of new Education Index.




Changes occurred in Income Index (II) in new HDI calculation

As per old HDI, the minimum income was $100 and maximum was$40, 000. As per new HDI, the minimum income is $163 andmaximum income is $108, 211. In old HDI, Gross Domestic Productwas taken and in new HDI, Gross national Income was taken. Theformula to calculation of new Income Index remained the same.

Changes occurred in new HDI calculation

There used to be taking of average mean of three indices to determineold HDI, but as per new HDI, the geometric value of three indices istaken as HDI.




Calculation of HDI of Nepal

As of 2013

LE= 67.8 years

MYS=3.2

EYS=12.4

GNIpc=$2660

Now,

LEI= LE−2085−20

=67.8−20

85−20=0.7354



EI=MYSI+EYSI

2

MYSI= 𝑀𝑌𝑆

15=3.2

15=0.2133

EYSI=𝐸𝑌𝑆

18= 12.4

18=0.6889

Therfore, EI= 0.2133+0.6889

2=0.4511

AND,

II= In (2660)−In(100)In(75000)− In(100)

=0.4956




𝑀𝑌𝑆𝐼 =𝑀𝑌𝑆

15𝐴𝑁𝐷 𝐸𝑌𝑆𝐼 =

𝐸𝑌𝑆

18HERE,

MYSI=mean year of schooling index

EYSI= Expected year of schooling index

MYS=mean year of schooling

EYS=expected year of schooling

𝐼𝑛𝑐𝑜𝑚𝑒 𝑖𝑛𝑑𝑒𝑥(𝐼𝐼) =𝐼𝑛(𝐺𝑁𝐼𝑝𝑐) − 𝐼𝑛(100)

𝐼𝑛(75000) − 𝐼𝑛(100)




𝐻𝐷𝐼 =3𝐿𝐸𝐼 ∗ 𝐸𝐼 ∗ 𝐼𝐼

Where,

HDI= Human Development Index

HDI=𝟑𝟎. 𝟕𝟑𝟓𝟒 ∗ 𝟎. 𝟒𝟓𝟏𝟏 ∗ 𝟎. 𝟒𝟗𝟓𝟔 =0.548 (approx).




Top 10 HDI Rankings



Source: UNDP 2016 Human Development Report released in 21 march 2017



HDI of Nepal

Nepal has graduated to medium human developmentgrouping in the United Nations’ Human DevelopmentIndex (HDI), indicating Nepalese are growing healthier,becoming more educated and earning more.

Nepal secured a score of 0.558 in HDI in 2015, asagainst 0.548 in 2014, says the Human DevelopmentReport 2016 published by the UN.



In the same course of development and with thisscore, Nepal secured 144th position in the HDIamong 188 countries surveyed by the UN. Thisranking is same as that of the previous year. Theslight improvement in the score also helped Nepal toescalate to the medium human development groupfrom the low human development group.


HDI of Nepal


The 2014 Nepal National Human Development Report had foundwide variations in HDI values across population groups in Nepal.

The Newar people have the highest HDI value, 0.565. Close on theheels are Brahmins and Chhetris, with HDI value of 0.538. Thiswas followed by Janajatis, with HDI value of 0.482, Dalits HDIvalue is 0.434 and Muslims HDI value is 0.422.

The variations in HDI values are even significant within thesegroups, depending on where they live. The highest inequalities arein education, and this may have pronounced long-term effects oncapabilities later in life.


HDI of Nepal


The Welcome to School Initiative, for instance, led to anincrease in net enrolment of 470,000 children, 57 percent ofthem are girls, within a year of its implementation in 2005.The programme primarily focused on girls and disadvantagedgroups. “Nepal’s policy on adolescent girls was initiallycentered on health and education but now encompasses needsin employment, various skills development and civic

participation.


HDI of Nepal


Nepal in HDIYears HDI scores

2000 0.446

2010 0.529

2011 0.538

2012 0.545

2013 0.551

2014 0.555

2015 0.558



Nepal status in HDI



HDI and its Components


Human Development IndexComponents Datas

Health Life expectancy at birth (years)

70.0

Education Expected years of schooling (years)

12.2

Income/composition of

resources

Gross national income (GNI) per capita (2011

PPP$)

2,337

Inequality Inequality-adjusted HDI (IHDI)

0.407

Gender Gender Development Index (GDI)

0.925

Poverty Multidimensional Poverty Index (MPI)

0.116

Work employment and

vulnerability

Multidimensional Poverty Index (MPI)

0.116



Human Security Homicide rate (per 100,000

people)

2.9

Trade and financial flow Exports and imports (% of GDP)

53.2

Mobility and communication Internet users (% of population)

17.6

Environment sustainability Carbon dioxide emissions per

capita (tonnes)

0.2

Demography Population, total (millions)

28.5



Efforts of HDI for human development Universalism—from principles to practice



Reaching everyone—analytical and assessment issues


Efforts of HDI for human development


Caring for those left out—national policy options




Transforming global institutions




UNDP in Nepal



The Sustainable Development Goals (SDGs), or known as the Global Goals, are a universal call to action in order to end poverty, protect the planet and ensure that all people enjoy peace and prosperity.

These 17 Goals build on the successes of the MillenniumDevelopment Goals, while including new areas such as climatechange, economic inequality, innovation, sustainable consumption,peace and justice, among other priorities. The goals areinterconnected often the key to success on one will involve tacklingissues more commonly associated with another.


What are the sustainable development goals?


HDI as the indicator of overall Development

Schooling

Life expectancy

Measuring of standard of living

Per capita income



Limitations

Limited evaluation of human development.

HDI does not measures qualitative factors such as cultural identity, gender opportunities.

Purchasing power parity value used to adjust GNI data change quickly and can be inaccurate or misleading.

No replicate on quality of life factors, such as empowerment movements or overall feelings of security.

Focuses on long term development without considering nature and ecosystem.



Poverty

Poverty is a condition of having an insufficient resourcesor income.in its most extreme form, poverty is a lack ofbasic human needs such as adequate and nutritious food,clothing housing, clean water and health services

Extreme poverty can cause terrible suffering and death andeven modest level of poverty can prevent people fromrealizing many of their desires.



Causes And Effects Of Poverty

Causes of poverty

Overpopulation

Global distribution of resources

Inadequate education and employment

Economic and demographic trends

Welfare dependency



Effects of poverty

Malnutrition and starvation

Infectious disease

Mental illness and drugs dependency

Crime and violence

Illiteracy


Causes And Effects Of Poverty