The Limits of the HDI

Question 1

Author of the paper?

Answer 1

Bilbao-Ubillos (2011).

Question 2

Three components of the HDI

Answer 2

‘Longevity’, ‘knowledge’ and ‘economic welfare’.

Question 3

First limitation: HDI fails to take into account…

Answer 3

…the degree of economic and social cohesion in a country, and hence to the extent to which the population shares in the average progress achieved there.

Question 4

FINLAND and USA

Answer 4

Have almost exactly the same HDI levels, but in USA the income of the wealthiest 10% of the population is 15.9 times that of the poorest 10%, while in FINLAND it is only 5.6 times greater.

Question 5

Second limitation: HDI fails to reflect any…

Answer 5

…development-oriented strategies that may be adopted by govts to translate economic growth into development.

Question 6

Technique to check if improvements in the HDI are driven exclusively by increases in per capita income

Answer 6

The position of a country in the world ranking for GDP per capita can be compared with its position in the HDI ranking.

Question 7

Third limitation: HDI does not reflect the…

Answer 7

…prospects for development in a country on the basis of sustainability of current development levels.

Question 8

Technology sustainability

Answer 8

Countries that dedicate fewer resources to R&D can be expected to find it more difficult to compete in new markets so their positions will be weaker.

Question 9

Balance of Payments sustainability

Answer 9

BofP and external debt indicators give an idea of the degree of dependence of a state on external funding and can provide early warning of potential constraints on its economic performance.

Question 10

Demographic sustainability

Answer 10

Refers to the degree to which population trends in a country match its need for human resources to make its economy work.

Question 11

Expected population growth of AFRICA by 2040?

Answer 11

> 1%.

Question 12

Expected population growth of EUROPE by 2040?

Answer 12

Negative.

Question 13

Environmental sustainability

Answer 13

HDI does no consider the depletion of non-renewable natural resources.