1.b. The relationship between patterns of socio-economic development using remittances and HDI

Question 1

What is the relationship between the value of migrant remittances and a country’s level of development?

Answer 1

• As HDI increases the value of remittances as a % of its GDP decreases
• As HDI increases the GDP increases because the country will get more developed and so the value of remittances will be proportionally a lot less than the GDP of the country therefore, the value of remittances as a % of its GDP will be a lot less

Question 2

How do you measure the relationship between the value of migrant remittances and a country’s level of development?

Answer 2

By using the Spearman’s rank - it measures the strength of the relationship between two variables

Question 3

How to calculate Spearman’s rank

Answer 3

• Rank both sets of data. Rank 1 given to the largest number.
• If there are two samples with the same value, the mean (average) rank should be used – for example if there were 3 samples all with the same number ranked 6th in order you would add the rank values together (6+7+8=21) then divide this number by the number of samples with the same number, in this case 3 (21/3=7) so they would all receive a rank of 7. The next greatest depth would be given a value of 9.
• Calculate the difference (d) between the two rankings. It is possible to get negative answers
• Calculate d2 , to eliminate the negative
• Add up (∑) the d2 values.
• Calculate the correlation coefficient (r) by using the formula below
  𝑟 = 1 − 6(∑ 𝑑^2) / 𝑛(𝑛^2 − 1)