Presented By:

Agenda:

• Human Development Concept

• HDI History, Meaning and

• HDI and its related indices

• Calculation of HDI

• Link between Economic Growth & Human

Development

• Planning in terms of Human Development

• HDI - India

• HDI - Critics

Human Development is necessary

because:

• Human Development is an end while

economic growth is only a means to it

• It is a means to higher productivity

• Helps in lowering family size

• It is good for the physical environment

• It reduces poverty and contributes to a

healthy civil society, increased democracy and

greater social stability

Essential components of Human

Development:

• Equity - People must enjoy equitable access

to opportunities

• Sustainability – The next generation must

enjoy the same well being that we enjoy

• Productivity – Requires investment in people

and enabling micro-environment for them

• Empowerment – It means people are in a

position to exercise choices of their own free

will

• An alternate to GNP - measure of nation’s

human development

• UNDP introduced HDI under the able

stewardship of Dr. Mahbub ul Haq in 1990

• HDI includes related indices like GDI, GEM and

HPI

• It is a composite index rather than a plethora of

indexes

•Ratings lie between 0-1 (0 is least and 1 signifies

good rating)

A process of enlarging people’s choices and

enhancing human capabilities and freedom,

enabling them to: live a long and healthy life,

have access to knowledge and a decent

standard of living, and participate in the life of

their community and decisions affecting their

lives.

• As per HDI of 2006: Iceland’s HDI is 0.968

(highest), Norway is 0.968, Canada is 0.967

• India’s HDI is 0.609, ranks 132nd

• HDI - Human Development Index

• GDI - Gender-related Development Index

• GEM - Gender Empowerment

• HPI - Human Poverty Index

• The index measurement is same as that of HDI,

but takes note of inequality in achievement

between women and men

• The methodology used imposes a penalty for

inequality

• GDI falls when the achievement levels of both

women and men in a country go down

• The greater the gender disparity in basic

capabilities, the lower a country's GDI compared

with its HDI.

•The Gender Empowerment Measure (GEM) is a

measure of agency

• It evaluates progress in advancing women's

standing in political and economic forums

•Examines the extent to which women and men

are able to actively participate in economic and

political life.

(gender equality in economic and political participation & decision making)

• HPI uses indicators of the most basic dimensions of

deprivation: a short life, lack of basic education and lack

of access to public and private resources.

• The HPI concentrates on the deprivation in the three

essential elements of human life already reflected in

the HDI: longevity, knowledge and a decent

standard of living.

• Define a minimum and maximum value for each

of the three dimensions of the HDI

- Life Expectancy

- Real GDP per capita

- Educational attainment (combine two

variables)

1. Adult Literacy

2. Enrollment Ratio

i.e. 2 * (Adult Litracy) + (Enrollment Ratio)

• Define an index of achievement for each of the

three dimensions

•HDI is the simple average of three indices of

achievement

• HDI =(Life Expectancy Index + Real GDP Index +

Educational attainment Index ) / 3

Growth requires fostering of strong links between economic growth and Human Development. This can be accomplished in the following ways:

Provision of remunerative employment to people More equitable distribution of income and

economic opportunities Access to productive assets Investment in education and health Gender equality

Mahbub ul haq has made a strong plea for planning models and strategies in terms of human of human development.

1) The plans would start with a human balance sheet

2) Plans target would first be expressed in terms of basic human needs and only later translated into physical targets for production and consumption

3) Equal emphasis on production and distribution objectives.

Table 1: India's human development index 2006 and underlying indicators in comparison with No. 1 country.

HDI value2006

Life expectancy at birth (years)2006

Adult literacy rate (% ages 15 and above)2006

Combined primary, secondary & tertiary gross enrolment ratio (%)2006

GDP per capita(PPP US$)2006

1. Iceland (0.968)

1. Japan (82.4)

1. Georgia (100.0)

1. Australia (114.2)

1. Luxembourg (77,089)

132. India (0.609)

127. India (64.1)

118. India (65.2)

134. India (61.0)

126. India (2,489)

Table 2: Selected indicators of human poverty for India w.r.t. other countries

Human Poverty Index (HPI-1) 2006

Probability of not surviving past age 40 (%) 2005

Adult illiteracy rate (%ages 15 and older)

2006

People without access to an improved water source (%)2006

Children underweight for age (% ages 0-5) 2006

1. Czech Republic (1.7)

1. Singapore (1.8)

1. Cuba (0.2)

1. Bosnia and Herzegovina (1)

1. Croatia (1)

87. India (28.5)

84. India (16.8)

97. India (34.8)

49. India (11)

134. India (46)

Table 3: The GDI compared to the HDI – a measure of gender disparity

GDI as % of HDI

Life expectancy at birth(years) 2006

Adult literacy rate

(% ages 15 and older) 2006

Combined primary, secondary and tertiary gross enrolment ratio2006

Female as % male Female as % male Female as % male

1. Sweden (99.9%)

1. Russian Federation (123.1%)

1. Lesotho (122.5%)

1. United Arab Emirates (120.2%)

138. India (97.1%)

122. India (104.9%)

115. India (70.0%)

126. India (89.3%)

• Dasgupta and Weale (1992) point out the

fact that it is an index restricted to the socio-

economic sphere of life

• The second block of critics including

Srinivasan(1994) & UNDP(1993) is concerning

data quality and the exact construction of the

index

• The third range of arguments showing the

weakness of the HDI reflects the aggregation

problems (Desai, 1991)

• The last group of critics refers to the

technical properties of the index

(McGillivray)1991

• Empirical data to discuss the HDI capacity to

reflect human development through the

enlargement of people’s choices,

opportunities and capabilities