4.3.1

Question 1

Define HDI

Answer 1

A broad measure of development capturing measures of health (life expectancy), education ( mean & expected years in school ) and GNI per capita (living standards).

Question 2

What are the advantages of using the HDI ?

Answer 2

• Holistic Measure: HDI provides a comprehensive view of development by considering health, education, and living standards.
• Simplicity: The HDI is easy to understand and calculate, making it accessible for policymakers and the public.
• Global Comparisons: It allows for comparisons between countries and over time, highlighting trends in human development.
• Policy Guidance: HDI can guide policymakers in identifying areas of development that require attention

Question 3

What are the drawbacks of using HDI?

Answer 3

• Limited Indicators: HDI does not include all dimensions of development, such as environmental sustainability, gender equality, or income distribution.
• Data Quality: HDI relies on data accuracy, which may be lacking in some countries, leading to potential inaccuracies.
• Weighting Issues: Equal weighting of dimensions may not accurately reflect a country’s development priorities.
• Regional Differences: HDI masks disparities within countries, as it presents an average for the entire nation.
• Inequality: It does not consider income or education inequality, potentially overlooking disparities within countries.

Question 4

How does productivity affect HDI? Analysis + eval

Answer 4

Productivity is a measure of the efficiency of factors of production. For example the output of each employee per hour.

In the long run, productivity is a major determinant of economic growth and also of inflation. This is besuche a rise in labour productivity leads to a fall in firm’s cost of production, assuming wage levels remain the same. Higher productivity allows businesses to achieve increased profits and allows them to pay businesses higher wages. So progress in lifting labour and capital productivity is importantly for low and middle income countries who wish to increase their HDI.
However, higher productivity does not necessarily translate to higher HDI values, as GNI per capita is only 1/3 of the weighting of the HDI. Education and healthcare also have equal importance.

Question 5

what are some indicators of development other than HDI?

Answer 5

• Gini Coefficient: Measures income inequality within a country, indicating the distribution of wealth among its citizens.
• Human Poverty Index (HPI): Focuses on severe deprivation in health, education, and standard of living, emphasizing the most disadvantaged populations
• Environmental Sustainability Indicators: Evaluate a country’s impact on the environment, including carbon emissions, natural resource depletion, and pollution.
• Gender Inequality Index (GII): Evaluates gender disparities in health, education, and economic participation, highlighting gender-based inequalities.