Problems With Single Indicators

Question 1

where money is spent

Answer 1

GNI figures do not show where money is being spent, so it may not be going towards things like education and healthcare to improve development

Question 2

distribution of wealth

Answer 2

single indicators are too broad; they do not show the distribution of wealth, eg. there may be a few very rich families which skew the GNI while the rest of the population lives at subsistence level

Question 3

differences between regions

Answer 3

some regions of a country may be batter off than others, eg. a north/south or rural/urban divide in wealth or quality of life

Question 4

different forms of wealth

Answer 4

barter economies and subsistence agriculture are not included in economic indicators despite carrying forms of wealth

Question 5

irrelevant to true quality of life

Answer 5

some single indicators are irrelevant to the true quality of life in some developing countries

Question 6

exchange rates

Answer 6

exchange rates fluctuate, making GNI comparisons unreliable

Question 7

HDI

Answer 7

the HDI uses a combination of wealth, health and education indicators, giving a more balanced view of development