Working Paper: CEPR ID: DP7982
Authors: Leandro Prados de la Escosura
Abstract: The pessimistic flavour of the Human Development Reports appears to be in contradiction with their own numbers as developing countries fare comparatively better in human development than in per capita GDP terms. This paper attempts to bridge this gap by providing a new, ?improved? human development index [IHDI], informed by welfare economics. The IHDI is presented here alongside the UNDP?s HDI for the world and its main regions since the late nineteenth century. Social dimensions in the IHDI are derived, following Kakwani (1993), with a convex achievement function, while a geometric average is employed to combine its dimensions (longevity, knowledge, and income). Thus, the IHDI does not conceal the gap between rich and poor countries and casts a much less optimistic view than the conventional UNDP index, while fits with the UNDP concern for international differences. The paper?s findings highlight main weaknesses in human development dimensions of present-day developing countries.
Keywords: education; human development; life expectancy; per capita GDP
JEL Codes: I00; N30; O15; O50
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| improved human development index (ihdi) (O15) | accurate reflection of human development outcomes (O15) |
| improved human development index (ihdi) (O15) | less optimistic view of human development in developing countries (O15) |
| methodology of the improved human development index (ihdi) (O15) | perceived levels of human development (O15) |
| construction of the improved human development index (ihdi) (O15) | realistic representation of human development progress (O15) |
| improvements in life expectancy and education (I14) | better human development outcomes (O15) |
| improved human development index (ihdi) (O15) | sobering view of disparity between rich and poor countries (F63) |