Human Development Index

Human Development Index (HDI)

• Human Development Index (HDI): A

composite index measuring average
achievement in three basic dimensions of
human development—a long and healthy life,
knowledge and a decent standard of living.
 Components of HDI
• Life expectancy at birth: Number of years a newborn infant could
expect to live if prevailing patterns of age-specific mortality rates at
the time of birth stay the same throughout the infant’s life.
• Mean years of schooling: Average number of years of education
received by people ages 25 and older, converted from education
attainment levels using official durations of each level.
• Expected years of schooling: Number of years of schooling that a
child of school entrance age can expect to receive if prevailing
patterns of age-specific enrolment rates persist throughout the
child’s life.
 Contd..
• Gross national income (GNI) per capita:
Aggregate income of an economy generated by
its production and its ownership of factors of
production, less the incomes paid for the use of
factors of production owned by the rest of the
world, converted to international dollars using
purchasing power parity (PPP) rates, divided by
midyear population.
 Contd..
• GNI per capita rank minus HDI rank: Difference in rankings
by GNI per capita and by the HDI. A negative value means
that the country is better ranked by GNI than by the HDI.

• Non- income HDI: Value of the HDI computed from the life
expectancy and education indicators only.

• Human Development Index (HDI): A composite index

measuring average achievement in three basic dimensions
of human development—a long and healthy life,
knowledge and a decent standard of living.
Calculating Human Development Index
• The Human Development Index (HDI) is a summary
measure of human development.
• It measures the average achievements in a country in
three basic dimensions of human development: a long
and healthy life, access to knowledge and a decent
standard of living.
• The HDI is the geometric mean of normalized indices
measuring achievements in each dimension.
Steps to estimate the Human Development Index

• Step 1. Creating the dimension indices

• Minimum and maximum values (goalposts)

are set in order to transform the indicators
into indices between 0 and 1.

• These goalposts act as the ‘natural zeroes’ and

‘aspirational goals’, respectively, from which
component indicators are standardized
Goal Posts
 Goal Posts Contd..
• The justification for placing the natural zero for life
expectancy at 20 years is based on historical evidence that
no country had life expectancy of less than 20.
• Societies can subsist without formal education, justifying
the education minimum of 0 years.
• The maximum for mean years of schooling, 15, is the
projected maximum of this indicator for 2025.
• The maximum for expected years of schooling, 18, is
equivalent to achieving a master’s degree in most
countries.
 Goal Posts Contd..
• The low minimum value for gross national income (GNI) per
capita, $100, is justified by the considerable amount of
unmeasured subsistence and nonmarket production in
economies close to the minimum, which is not captured in
the official data.

• The maximum is set at $75,000 per capita.

• Kahneman and Deaton (2010) have shown that there is a

virtually no gain in human development and well-being
from annual income beyond $75,000.
 Dimension Index Calculation
• the sub indices are calculated as follows:
 Contd..
• For education, equation 1 is applied to each of

the two subcomponents, then the arithmetic

mean of the indices used as the education

index.

• For income the natural logarithm of the

actual minimum and maximum values is used.

 Step 2: Aggregating the sub-indices to produce the
Human Development Index

• The HDI is the geometric mean of the three

dimension indices:
Example: Cyprus
 Purchasing Power Parity (PPP) $

• Official PPP conversion rates are produced by the

International Comparison Program, whose
surveys periodically collect thousands of prices of
matched goods and services in many countries.

• The last round of this exercise refers to 2011 and

covered 180 countries.
 Methodology used to express income
• The World Bank’s 2015 World Development Indicators database contains estimates
of GNI per capita in 2011 purchasing power parity (PPP) terms for many countries.

• For countries missing this indicator, the Human Development Report Office
calculates it by converting GNI from current to constant terms using two steps.

• First, the value of nominal GNI per capita is converted into PPP terms for the base
year (2011).

• Second, a time series of GNI per capita in 2011 PPP terms is constructed by
applying the real growth rates to the GNI per capita in PPP terms for the base year.

• The real growth rate is implied by the ratio of the nominal growth of current GNI
per capita in local currency terms to the GDP deflator.
 Country Groupings
Group HDI Value

Very high human development 0.800 and above

High human development 0.700–0.799

Medium human development 0.550–0.699

Low human development Below 0.550

HDI MPI Spreadsheet
 Multidimensional Poverty Index
• The Multidimensional Poverty Index (MPI)
identifies multiple deprivations at the
household level in education, health and
standard of living.

• It uses micro data from household surveys

 Components
• Education:
• School attainment: no household member has completed at least six years
of schooling.
• School attendance: a school-age child (up to grade 8) is not attending
school
• Health:
• Nutrition: a household member is malnourished, as measured by the body
mass index for adults and by the height-for-age z score calculated using
World Health Organization standards for children under age 5.
• Child mortality: a child has died in the household within the five years
prior to the survey
 Components contd..
• Standard of living:

• Electricity: not having access to electricity.

• Drinking water: not having access to clean drinking water or if the source
of clean drinking water is located more than 30 minutes away by walking.

• Sanitation: not having access to improved sanitation.

• Cooking fuel: using ‘dirty’ cooking fuel (dung cake, wood or charcoal).

• Having a home with a dirt, sand or dung floor.

• Assets: not having at least one asset related to access to information

(radio, TV, telephone) and not having at least one asset related to mobility
(bike, motorbike, car, truck, animal cart, motorboat) or at least one asset
related to livelihood (refrigerator, arable land, livestock).
 Methodology
• Each person is assigned a deprivation score according to his
or her household’s deprivations in each of the 10
component indicators.
• The maximum deprivation score is 100 percent with each
dimension equally weighted; thus the maximum
deprivation score in each dimension is 33.3 percent.
• The education and health dimensions have two indicators
each, so each indicator is worth 33.3 / 2, or 16.7 percent.
• The standard of living dimension has six indicators, so each
indicator is worth 33.3 / 6, or 5.6 percent.
Example
HDI MPI Spreadsheet
 Assessment of Energy Poverty in India: A
Multidimensional Approach

• Energy poverty is widespread in India with large

geographical variation across states.

• Energy poverty coincides with social backwardness of

people.

• Energy poor are not necessarily income poor in villages.

• Energy poverty is associated with health hazards like

Asthma and Tuberculosis.
 Components
• Lighting

• Whether the household has access to electricity

• Cooking

• Whether the household has access to LPG

• Whether the household uses a traditional chulha without chimney.

• Use of biofuel

• Five components under additional measures which include use of

firewood, dung cake, crop residue, kerosene and coal/charcoal for
cooking, lighting and heating purposes.
 State wise MEPI
State 1 2 3 4 5 6 7 8 9 10
Jammu & Kashmir 100 53.61 42.08 29.86 17.36 6.25 2.08 0.14 0.14 0.00

Himachal Pradesh 100 75.80 67.25 48.88 30.85 4.00 0.47 0.27 0.14 0.00

Punjab 100 62.71 55.12 44.65 25.06 10.47 2.71 0.94 0.71 0.00

Chandigarh 100 7.06 7.06 4.71 3.53 0.00 0.00 0.00 0.00 0.00

Uttarakhand 100 75.21 66.45 61.11 46.58 22.65 7.26 4.70 2.99 0.00

Haryana 100 82.30 75.31 68.43 43.46 18.49 4.34 2.59 2.42 0.17

Delhi 100 9.71 6.14 4.24 1.79 0.56 0.11 0.11 0.00 0.00

Rajasthan 100 81.31 76.74 71.51 61.42 46.48 33.09 13.91 11.83 6.90

Uttar Pradesh 100 84.97 81.64 76.79 70.18 61.53 50.09 37.21 30.76 13.53

Bihar 100 87.34 83.61 80.52 75.87 69.18 54.69 36.20 35.28 18.49

Sikkim 100 16.04 14.15 11.32 6.60 1.89 0.00 0.00 0.00 0.00

Arunachal Pradesh 100 44.52 41.94 32.90 32.90 1.29 1.29 1.29 0.00 0.00
 State wise MEPI
State
1 2 3 4 5 6 7 8 9 10
Nagaland 100 18.10 9.52 0.95 0.95 0.95 0.95 0.95 0.95 0.00

Manipur 100 10.23 5.68 3.41 0.00 0.00 0.00 0.00 0.00 0.00

Mizoram 100 45.33 21.33 14.67 0.00 0.00 0.00 0.00 0.00 0.00

Tripura 100 82.11 70.18 68.81 63.30 12.39 11.93 11.93 11.93 0.00

Meghalaya 100 77.44 76.69 68.42 56.39 6.77 0.75 0.75 0.75 0.00

Assam 100 80.59 55.87 55.06 47.19 31.05 30.44 26.97 24.21 2.15

West Bengal 100 74.05 72.36 68.02 60.50 49.50 32.11 18.31 17.52 8.35

Jharkhand 100 87.29 80.12 74.82 59.88 44.35 25.29 13.06 10.59 2.12

Orissa 100 87.21 85.08 83.28 80.12 50.75 34.66 26.01 24.79 1.94

Chhattisgarh 100 87.21 86.37 83.88 80.70 58.67 18.62 9.54 9.31 0.15

Madhya Pradesh 100 87.60 86.03 83.66 75.34 66.72 33.09 18.39 17.26 4.64

Gujarat 100 64.71 59.83 54.64 45.10 28.83 13.73 3.13 2.60 0.32
 State wise MEPI
State
1 2 3 4 5 6 7 8 9 10
Daman &Diu 100 76.27 49.15 38.98 18.64 3.39 0.00 0.00 0.00 0.00

Dadra, Nagar Haveli 100 64.41 49.15 49.15 40.68 5.08 0.00 0.00 0.00 0.00

Maharashtra 100 69.24 59.51 53.64 46.97 32.92 18.71 5.23 4.87 1.98

Andhra Pradesh 100 68.13 50.00 46.16 37.19 6.34 2.36 1.85 1.71 0.00

Karnataka 100 80.83 64.72 61.01 39.85 13.15 6.01 4.04 3.81 0.03

Goa 100 3.72 3.72 1.60 1.60 0.53 0.53 0.53 0.00 0.00

Lakshadweep

Kerala 100 87.31 47.54 36.20 10.43 2.20 1.04 0.78 0.71 0.00

Tamil Nadu 100 49.90 40.39 36.11 30.11 4.02 2.19 1.98 1.32 0.00

Pondicherry 100 28.04 10.28 10.28 7.48 0.00 0.00 0.00 0.00 0.00

Overall 100 74.48 65.84 60.56 49.68 32.45 19.93 11.94 10.71 3.55
 Highest MEPI Scores
• State wise number of districts with more than
90% of population having MEPI score of more
than 33.3% are as follows:
• 19 districts Uttar Pradesh, 17 in Madhya Pradesh,
13 in Orissa, 11 in Chhattisgarh, 8 in Bihar, 6 in
Rajasthan, 5 in West Bengal, 3 in Maharashtra, 1
each in Assam, Jharkhand, Gujarat, and
Karnataka.
 Caste/Religion wise MEPI Scores

Caste/Religion 1 2 3 4 5 6 7 8 9 10
Brahmin 100 53.30 45.87 38.35 27.13 19.01 11.49 5.49 4.43 1.66

Forward caste 100 59.34 48.53 40.42 29.58 17.58 9.46 4.52 4.14 1.55
excluding Brahmin
Other Backward 100 76.92 67.94 63.53 52.02 35.22 21.24 12.34 10.6 4.20
Castes 5
Dalit 100 82.82 77.06 72.93 62.72 38.87 24.46 14.94 13.5 5.17
7
Adivasi 100 88.62 84.33 81.75 73.80 48.57 31.27 20.96 19.6 2.63
3
Muslim 100 77.39 67.11 61.93 50.10 35.51 22.98 14.97 13.9 4.00
1
Christian, Sikh, Jain 100 56.95 34.71 22.41 9.35 2.44 1.01 0.51 0.25 0.00
 Village- Town Difference in MEPI and Income

Cumulative Energy Poverty Average Total Income

Frequency Village Town Village Town

1 100.00% 100.00% 222833.61 241041.10

2 53.15% 25.48% 157755.92 168427.59

3 43.94% 17.22% 135834.89 107133.00

4 38.73% 13.65% 142036.28 99567.61

5 30.79% 9.05% 83024.53 77755.80

6 16.95% 4.36% 73215.32 75476.03

7 9.69% 2.19% 72831.94 66293.50

8 5.84% 1.51% 40314.43 48290.91

9 5.47% 1.13% 62987.43 55377.10

10 1.27% 0.07% 54782.87 58750.00

 MEPI and Illness
Mental
Frequency TB BP Heart Cancer Asthma Illness
1
1.17 22.39 5.52 0.39 3.22 1.10
2
0.87 22.66 6.35 0.65 4.56 1.58
3
2.13 22.54 6.07 0.23 5.33 1.39
4
1.60 17.32 4.58 0.66 4.82 2.04
5
1.75 9.89 2.66 0.22 4.26 1.39
6
2.14 7.94 2.59 0.19 4.96 1.74
7
2.93 7.82 2.42 0.21 6.04 2.21
8
3.68 5.43 2.14 0.58 5.03 1.75
9
2.74 5.64 1.14 0.27 4.60 1.70
10
4.17 3.98 1.93 0.20 7.39 1.86