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Tuesday, August 23, 2011

The Human Development Index

In 1990, the United Nations Development Program felt that a standardized method needed to be created to measure human welfare. A measurement that could be used by policy makers in government, charities, politics, social action groups, and the public in general.
The architects of the program faced many challenges:
How can you find a standard way of measuring human well-being across various countries and cultures?
How can you shift the historic focus of development from economic policies to people-centered initiatives?
How can you gain the acceptance of policy makers to use the data, and convince them to act on it? Some of the UN committee members felt that a single numerical value would be less ambiguous and more acceptable.

Goals were developed and accepted. The HDI must include:
A way to represent the longevity and healthiness of a human life.
A way to represent a person’s access to educational opportunities.
A way to represent the adequacy of a person’s standard of living.
A way to determine changes in human development over time (trends).
A way to make projections of what could be ahead (predictions).

A definition was agreed upon:
A human development “rating” is a single numerical value determined by a complicated algorithm. It represents the country’s level of life expectancy, average and expected years of schooling, and the per capita GNI. The numerical values range from 0.001 up to 1.000.
The “index” itself is a comparative measure that ranks all countries by their rating into a general level of development that is either Very High, High, Medium, or Low.
(the project also calculates HDI for states/provinces and cities)
The U.N.’s HDI Program was not without criticisms, some valid, others not.
Some believed that data to be collected already existed and that it has been thoroughly studied. The goal of the program was to combine data in a new way to reflect human well being. Studying narrow categories of data didn’t contribute to this goal. Some were concerned over data reliability. While this is a valid concern, all data is to some degree flawed. Some felt that there was a failure to include ecological factors in the quality of human life. This probably a true criticism and may be addressed going forward. Others believed that the group classifications (very high, high, medium, low) were arbitrary and could be used to stigmatize countries. Well, countries are already stereotyped by things that have no quantifiable basis at all. In spite of these criticisms, the project went forward.
Since its beginning in 1990, there have been 21 annual reports with 21 indices. Over that time only four countries have been ranked number one in the world. Norway and Canada topped the list eight times each, Japan three times, and Iceland twice.

One hundred seventy one UN-member countries submitted data for the 2010 Report. Twenty four countries were not included because of the unavailability of data including Bhutan, Cuba, Iraq, Lebanon, Oman, North Korea, Somalia, and 17 smaller countries.
The top ten highest ranked countries in the 2010 HDI were:
1. Norway (.938)
2. Australia (.937)
3. New Zealand (.907)
4. United States (.902)
5. Ireland (.895)
6. Liechtenstein (.891)
7. Netherlands (.890)
8. Canada (.888)
9. Sweden (.885)
10. Germany (.885)
(the world average is .624)

Two interesting summaries from the 2010 HDI are:

Number of Countries in Each Classification - by Major Geographic Area
(taking to 10 highest ranked and the 10 lowest ranked countries)

                                        Very High   High          Medium     Low

Europe                               10             9              1              -

Asia/Oceana                       10             -               4              6
(incl. Australia and NZ)

Americas                            4              6              9              1
(incl. North and South)

Africa                                 -               4              6              10

These numbers are more or less expected. Europe, especially Western Europe, is a highly developed society. Asia’s numbers are bolstered by Australia (#2) and New Zealand (#3) in the world rankings.

Number of Countries in Each Classification - by Affiliation
(taking to 10 highest ranked and the 10 lowest ranked countries)

                                        Very High   High          Medium     Low

European Union                   16             4              -               -

East Asia/Pacific                  7              8              3              2

Middle East/North Africa       5              9              4              2

Arab League                       3              7              5              5

Latin America                     -               12             7              1

These numbers are also somewhat as expected. The oil producing countries tend to rank quite low in the HDI, leading us to believe that that revenue is not being used to improve the living conditions of the masses.

There are also a surprising number of large and important countries that are well down in the 2010 HDI rankings. But population size is not a factor in the ratings formula.
46. Argentina (.775)
57. Saudi Arabia (.752)
58. Mexico (.750)
59. Malaysia (.744)
67. Russia (.719)
71. Ukraine (.710)
72. Iran (.702)
75. Brazil (.699)
85. Turkey (.679)
91. China (.663)
104. Egypt (.620)
111. Indonesia (.600)
113. South Africa (.597)
122. India (.519)
128. Pakistan (.490)
131. Kenya (.470)
132. Bangladesh (.469)
135. Burma/Myanmar (.451)
157. Sudan (.379)
158. Afghanistan (.349)
The lowest ranked country in the world in 2010 was Zimbabwe #171 (.140)


The table below summarizes how countries changed their rankings between 2007 and 2010. Who is moving up, who is moving down, and who didn’t change at all?
There are some surprises in the details.

Of the countries (totaling 57) in the top third of the rankings in 2010, the largest proportion actually saw a DECREASED ranking. These were members of the group that historically included the most developed - Western European countries. Included were the U.K., the Netherlands, France, Switzerland, Belgium, Denmark, Spain, Sweden, and Italy. Canada also joined this group. The reasons are still not clear. Did the economic downturn affect these developed countries more than others, probably? Were opportunities for education or health care reduced, maybe? Did immigration into these countries from undeveloped areas contribute to this?

Of the countries (totaling 57) in the middle third of the rankings, the largest proportion INCREASED, by far, their rankings. Many of these were from the nations that had been struggling toward a high standard of living after the breakup of the Soviet Union or other totalitarian regimes - the Eastern European countries. They included Bulgaria, Serbia, Belarus, Russia, Albania, Bosnia, Ukraine, Azerbaijan, and Macedonia. The countries showing increased rankings also included many South American countries such as Brazil, Peru, Belize, Bolivia, Ecuador, and Jamaica. Increasing income in eastern Europe, and improved health and education opportunities in South America were the likely contributors.

Finally, the countries (totaling 57) in the bottom third of the rankings overwhelmingly remained UNCHANGED. Regrettably, these are the sub-Saharan African nations. They include Ghana, Cameroon, Uganda, Senegal, Zambia, Gambia, Liberia, Mozambique, Niger, Zimbabwe, and The Democratic Republic of the Congo. It appears that little has changed in Africa to improve the lives of the millions living there. Shifting populations, civil wars, famine, and political conflict head the list of problems for this region. 

Number of Countries by Movement in the Rankings (2007 to 2010)
                                        Increased          Unchanged         Decreased

Top third in 2010                 23                     7                      27
(#1 - #57)
Middle third in 2010             35                   8                      14
(#58 - #114)

Bottom third in 2010            12                     34                   11
(#115 - #171)

All Countries                       70                     49                     52

All states in the county, if independent nations, would be classified in the Very High group of developed countries. The top ten ranked states are:
1. Connecticut
1. Massachusetts
3. Hawaii
4. California
5. Minnesota
5. New York
7. New Jersey
8. New Hampshire
8. Rhode Island
10. Colorado
By region, they are ranked as:
1. New England
2. West Coast
3. Mid-Atlantic
4. Midwest
5. West
6. Southwest
7. Southeast
The 2010 Human Development Index also includes a projection of where things will stand in 2030. It is the most controversial part of the HDI.
In my opinion, whoever calculated these rankings must have some bias built into their numbers as there is no data to support them. Predictions one year in the future are tenuous, but 20 years out? For me they have a strong lack of credibility. 
The table below lists the top 30 ranked countries for 2030 (along with their actual rankings for the last four years).
There are a lot of changes from 2010
The biggest climbers are Spain (up 16), Slovenia (up 14), Italy (up 13), France (up 11), Japan (up 10), Greece (up 9), and Austria (up 8).
The biggest drops belong to the U.S. (down 15) and Germany (down 11).
New faces among the top 30 include Croatia, Slovakia, Estonia, Hungary, and Poland (all Eastern European); plus Cyprus and Chile.
In all there are eight Eastern European countries, six from Asia/Pacific, one from South America, and none from sub-Saharan Africa.
You must take these projections with a grain of salt.

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