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Human Resource Development

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Human Resource Development (HRM-627)
VU
Lesson 21
HUMAN DEVELOPMENT INDEX (HDI)
The Human Development Index (HDI) is a comparative measure of life expectancy, literacy, education, and
standard of living for countries worldwide. It is a standard means of measuring well being, especially child
welfare. It is used to determine and indicate whether a country is a developed, developing, or underdeveloped
country and also to measure the impact of economic policies on quality of life. The index was developed in
1990 by Indian Nobel prize winner Amartya Sen, Pakistani economist Mahbub ul Haq, with help from Gustav
Ranis of Yale University and Lord Meghnad Desai of the London School of Economics and has been used
since then by the UNDP in its annual HDR. Described by Sen as a "vulgar measure", because of its limitations,
it nonetheless focuses attention on aspects of development more sensible and useful than the per capita income
measure it supplanted, and is a pathway for serious researchers into the wide variety of more detailed measures
contained in the Human Development Reports.
The HDI measures the average achievements in a country in three basic dimensions of human development:
 A long and healthy life, as measured by life expectancy at birth.
 Knowledge, as measured by the adult literacy rate (with two-thirds weight) and the combined primary,
secondary, and tertiary gross enrollment ratio (with one-third weight).
 A decent standard of living, as measured by the log of gross domestic product (GDP) per capita at
purchasing power parity (PPP) in USD.
Each year, UN member styates are listed and ranked according to these measures. Those high on the list often
advertise it, Former Prime Minister of Canada), as a means of attracting talented immigrants (economically,
individual capital) or discouraging emigration.
An alternative measure, focusing on the amount of poverty in a country, is the Human Poverty Index
Methodology
HDI trends between 1975 and 2004
OECD
Central and Eastern Europe, and the CIS
Latin
Arab States
South Asia
America and the Caribbean
East Asia
Sub-Saharan Africa
In general to transform a raw variable, say x, into a unit-free index between 0 and 1 (which allows different
indices to be added together), the following formula is used:
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Human Resource Development (HRM-627)
VU
x ­ min (x)
x-index =
max (x) ­ min (x)
where max(x)and min(x)are the lowest and highest values the variable x can attain, respectively.
The Human Development Index (HDI) then represents the average of the following three general indices:
LE ­ 25
Life Expectancy Index =
85 ­ 25
2
1
+
Education Index =
ALI
GEI
3
3
ALR ­ 0
Adult Literacy Index (ALI) =
100 ­ 0
CGER ­ 0
Gross Enrollment Index (GEI) =
100 ­ 0
log (GDPpc) ­ log (100)
GDP Index =
log (40000) ­ log (100)
LE: Life expectancy at birth
ALR: Adult literacy rate (ages 15 and older)
CGER: Combined gross enrolment ratio for primary, secondary and tertiary schools
GDPpc: GDP per capita at PPP in USD
UNDP has created a technical note on the definition of the HDI.
Examples
Calculation examples of the indices.
Minimum
Maximum
Index
Measure
Formula
value
value
L=
LE ­ 25
Longevity Life expectancy at birth (LE)
25 yrs
85 yrs
60
Literacy rate (LR)
0%
100%
2LR + CGER
E=
Education Combined gross enrolment ratio
3
0%
100%
(CGER)
Log10 GDPpc ­ 2
40,000 USD G =
GDP
GDP per capita (PPP)
100 USD
2.60206
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Human Resource Development (HRM-627)
VU
2006 report
Main article: List of countries by HDI
Coloured world map indicating Human Development Index (2004)
0.950 and over
0.900­0.949
0.650­0.699
0.600­0.649
0.350­0.399
0.850­0.899
0.800­0.849
0.550­0.599
0.500­0.549
0.300­0.349
under
0.750­0.799
0.700­0.749
0.450­0.499
0.400­0.449
0.300
N/A
The report for 2006 was launched in Cape Town, South Africa, on November 9, 2006. Its focus was on
"power, poverty and the global water crisis.. Most of the data used for the report are derived largely from 2004
or earlier, thus indicating an HDI for 2004. Not all UN member states choose to or are able to provide the
necessary statistics.
The report showed a stagnation in world HDI, as the continued improvement of developed countries was
offset by a general decline of the developing world. Countries in Sub-Saharan Africa and South Asia showed an
important decline in HDI, in comparison with last year's report. Other developing regions showed little to no
improvement.
A HDI below 0.5 is considered to represent low development and 29 of the 31 countries in that category are
located in Africa, with the exceptions of Haiti and Yemen. The bottom ten countries are all in Africa. The
highest-scoring Sub-Saharan countries, Equatorial Guinea and South Africa, are ranked 120th and 121st,
respectively (with a shared HDI of 0.653).
A HDI of 0.8 or more is considered to represent high development. This includes all developed countries, such as
those in North America, Western Europe, Oceania, and Eastern Asia, as well as some developing countries in
Eastern Europe, Central and South America, Southeast Asia, the Caribbean, and the oil-rich Arabian Peninsula.
Top thirty countries (HDI range from 0.965 down to 0.885)
1. Iceland 0.968
11. Finland 0.952
21. Hong Kong 0.937
2. Norway 0.968
12. United States 0.951
22. Germany 0.935
3. Australia 0.962
13. Spain 0.949
23. Israel 0.932
4. Canada 0.961
14. Denmark 0.949
24. Greece 0.926
5. Ireland 0.959
15. Austria 0.948
25. Singapore 0.922
6. Sweden 0.956
16. United Kingdom 0.946
26. South Korea 0.921
7. Switzerland 0.955
17. Belgium 0.946
27. Slovenia 0.917
8. Japan 0.953
18. Luxembourg 0.944
28. Cyprus 0.903
9. Netherlands 0.953
19. New Zealand 0.943
29. Portugal 0.897
10. France 0.952
20. Italy 0.941
30. Brunei 0.894
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Human Resource Development (HRM-627)
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Top/bottom three countries by region
Asia
Africa
007. Japan 0.949
047. Seychelles 0.842
022. Hong Kong 0.927
063. Mauritius 0.800
023. Israel 0.927
064. Libya 0.798
138. Nepal
175. Mali 0.338
176. Sierra Leone 0.335
177. Niger 0.311
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Table of Contents:
  1. INTRODUCTION TO HUMAN RESOURCE DEVELOPMENT:The Concept and its Dimensions, Targets of Development
  2. FOUNDATIONS OF HUMAN BEHAVIOR:Attitudes, Personality, Emotional Intelligence
  3. PERCEPTION:Attribution Theory, Shortcuts Frequently Used in Judging Others
  4. INTRINSIC MOTIVATION:Why Choose Big Five Framework?, THE OUTCOME OF FIVE FACTOR MODEL
  5. FIVE FACTOR MODEL:The Basis of Intrinsically Motivated Behavior, Intrinsic Motivation and Values
  6. MOTIVATION:EARLY THEORIES OF MOTIVATION, Designing Motivating Jobs
  7. The Motivation Process:HOW TO MOTIVATE A DIVERSE WORKFORCE?,
  8. INTERPERSONAL COMMUNICATION:PRINCIPLES OF INTERPERSONAL COMMUNICATION
  9. THE WORLD BEYOND WORDS:DIFFERENCES BETWEEN VERBAL AND NONVERBAL COMMUNICATION, MINDFUL LISTENING
  10. TRANSACTIONAL ANALYSIS:EGO STATES, Parent Ego State, Child Ego State
  11. TYPES OF TRANSACTIONS:Complementary Transactions, Crossed Transactions, Ulterior Transactions
  12. NEURO-LINGUISTIC-PROGRAMMING
  13. CREATE YOUR OWN BLUEPRINT
  14. LEADERSHIP:ORGANIZATIONAL DEMOCRACY
  15. LEADERSHIP:Environment and Strategic Leadership Link, Concluding Remarks
  16. UNDERSTANDING GROUP BEHAVIOR:Stages of Group Development, Advantages of Group Decision Making
  17. UNDERSTANDING TEAM BEHAVIOR:TYPES OF TEAMS, Characteristics of Effective Teams,
  18. EMOTIONAL FACET:PHYSICAL FACET
  19. HUMAN RESOURCE DEVELOPMENT & THE ROLE OF GOVERNACE:Rule of Law, Transparency,
  20. HUMAN RESOURCE DEVELOPMENT:The Concept and Its Dimensions, Targets of Development
  21. HUMAN DEVELOPMENT INDEX (HDI):Methodology,
  22. REPORTS:Criticisms of Freedom House Methodology, GROSS NATIONAL HAPPINESS
  23. SECTORS OF A SOCIETY: SOME BASIC CONCEPTS:PUBLIC SECTOR, PRIVATE SECTOR
  24. NON GOVERNMENTAL ORGANIZATIONS (NGOS):Types, Methods, Management, Citizen organization
  25. HEALTH SECTOR:Health Impact of the Lebanon Crisis, Main Challenges,
  26. A STUDY ON QUALITY OF PRIMARY EDUCATION BACKGROUND AND RATIONALE
  27. ADULT EDUCATION:Lifelong learning
  28. THE PRACTICAL PERSPECTIVE OF ADULT EDUCATION:Problems of Adult Literacy, Strategies for Educating Adults for the Future
  29. TECHNICAL & VOCATIONAL EDUCATION:VET Internationally, Technical Schools
  30. ASSESSING THE LINK BETWEEN INTELLECTUAL CAPITAL FORMATION AND PERFORMANCE OF A UNIVERSITY
  31. SCIENCE & TECHNOLOGY EDUCATION:Social responsibility, Curriculum content
  32. ENVIRONMENT:Dark Greens and Light Greens, Environmental policy instruments
  33. HDI AND GENDER SENSITIVITY:Gender Empowerment Measure
  34. THE PLIGHT OF INDIAN WOMEN:
  35. ENTREPRENEURSHIP:Characteristics of entrepreneurship, Advantages of Entrepreneurship
  36. A REVISIT OF MODULE I & II
  37. HUMAN DEVELOPMENT & ECONOMIC GROWTH (1975 TO 2003):
  38. PUBLIC PRIVATE PARTNERSHIP:Origins, The Desired Outcomes of PPPs
  39. PRINCIPLES OF PUBLIC PRIVATE PARTNERSHIP (PPP):Situation in Pakistan,
  40. DEVOLUTION REFORMS A NEW SYSTEM OF GOVERNMENT:
  41. GOOD GOVERNANCE:Participation, Rule of law, Accountability
  42. MACROECONOMIC PROFILE OF A COUNTRY: EXAMPLE ECONOMY OF PAKISTAN
  43. COORDINATION IN GOVERNANCE: AN EXAMPLE OF EU, The OMC in Social Inclusion
  44. MOBILIZING REGIONAL EDUCATIONAL RESOURCES: THE ASEAN UNIVERSITY NETWORK, A CASE STUDY
  45. GOVERNMENT PRIORITIES AND POLICIES:Role of Government, Socio Cultural Factors in Implementing HRD Programs