- GROWTH AND DEVELOPMENT
- THE FOUR PILLARS OF HUMAN DEVELOPMENT
- MEASURING HUMAN DEVELOPMENT
- INTERNATIONAL COMPARISONS
- Human development can be defined as the process of enhancing people’s freedoms and opportunities and improving their well-being.
- Human development focuses on improving the people’s live rather than assuming that economic growth will lead to greater wellbeing for all.
- Economic growth is seen as a means to development, rather than an end in itself.
|GROWTH AND DEVELOPMENT|
Meaning of both growth and development changes over a period of time. The difference is that growth is quantitative, whereas development is a qualitative concept.
|Increase in market output leads to economic growth||Economic development can be measured in terms of welfare values and market output|
|It is a quantitative concept||It is a qualitative concept|
|Economic growth is one dimensional in nature||Economic development is multidimensional in nature|
|This is one of the major concerns of developed countries||This is a major concern of developing countries|
|Economic growth and development are not interdependent.||Economic development can only happen if economic growth takes place.|
|Indicators of Economic growth- Real GDP, Real per capita income, National income etc.||Indicators of economic development – Human Development Index, Physical Quality of Life Index, Net Economic Welfare (NEW)|
|THE FOUR PILLARS OF HUMAN DEVELOPMENT|
|· It refers to making equality in accessibility to opportunities available to everybody. The opportunities available to people must be equal irrespective of their gender, race, income, class and in the Indian case, caste. Yet this is very often not the case and happens in almost every society.
· E.g. – In any country, it is interesting to see which group the most of the school dropouts belong to. This should lead to an understanding of the reasons for such behavior. In India, a large number of women and persons belonging to socially and economically backward sections drop out of school. This shows how the choices of these groups gets limited by not having proper access to knowledge.
|· It means continuity in the availability of opportunities. To have sustainable human development, each generation must have the same opportunities to make choices. All environmental, financial and human resources must be used keeping the future in mind – Sustainable development.
· Misuse of any of these resources will result into fewer opportunities for future generations.
· A good example would be the importance of sending girls to school. If a community does not stress on the importance of sending its girl children to school, these young women will be losing on many opportunities. Their career choices will be curtailed and this would affect other aspects of their lives. So, it is important for each generation to ensure the availability of choices and opportunities to its future generations.
|· Here it means human labor productivity or productivity in terms of human work. Such productivity needs to be constantly enriched by building capabilities in people. Ultimately, it is people who are the real resource of nations. Therefore, efforts to increase their knowledge, or provide better health facilities ultimately results into better work efficiency.|
|· Means to have the power to make choices. Such power comes from increasing freedom and capability to choose. Good governance with people-oriented policies are required to empower people.
· The empowerment of socially and economically disadvantaged groups holds special importance.
Approaches to Human Development
- Basic Needs
|· This approach is one of the oldest approaches to human development. Human development is seen as linked to income. The idea is that the level of income reflects the level of freedom an individual has.
· Higher the level of income, the more is the level of human development.
|· This approach looks at human beings as beneficiaries or targets of all developmental activities.
· The approach argues for higher government expenditure on education, health and basic amenities.
· People are not participants but only passive recipients.
· The government is solely responsible for increasing levels of human development by maximizing expenditure on welfare.
Basic Needs Approach
|· This approach was initially proposed by the International Labor Organization (ILO).
· Six basic needs i.e. health, education, food, water supply, sanitation, and housing were identified.
· The question of human choices is ignored and the emphasis is on the provision of basic needs of specific sections.
|· This approach is associated with Prof. Amartya Sen.
· Building human capabilities in the areas of health, education and access to resources is the key to increasing human development.
|MEASURING HUMAN DEVELOPMENT|
Human development Index (HDI)
- Published by the United Nations Development Programme (UNDP) on an annual basis, it is a statistical tool used to measure a country’s overall achievement in its social and economic dimensions.
- The social and economic dimensions of a country are based on the health of people, their level of education attainment and their standard of living.
- First report was published in
- The human development approach, developed by the economist Mahbub Ul Haq, is anchored in the Nobel laureate Amartya Sen’s work on human capabilities. It had the purpose “to shift the focus of development economics from national income accounting to people centered policies”.
- HDI is broken down into four tiers–
- Very high human development
- High human development
- Medium human development
- Low human development
- HDI measures average success of a country in three basic dimensions of human development:
- A long and healthy life
- Access to knowledge
- A decent standard of living
|HDI 2019 Report|
- Theme of the Report– “Beyond income, beyond averages, beyond today: Inequalities in human development in the 21st century”
- India’s position:
- India’s rank- 129 out of 189 (Last year’s rank- 130)
- Despite lifting 271 million people out of poverty between 2005-15, India still remains home to 28% (364 million) of the world’s poor.
- Between 1990 and 2018, India’s HDI value increased by 50 per cent (from 0.431 to 0.647), which places it above the average for countries in the medium human development group (0.634) and above the average for other South Asian countries (0.642).
- This means that in the last three decades, life expectancy at birth in India increased by 11.6 years, whereas the average number of schooling years increased by 3.5 years. Per capita incomes increased 250 times.
- India is only marginally better than the South Asian average on the Gender Development Index (0.829 vs 0.828), and ranks at a low 122 (of 162) countries on the 2018 Gender Inequality Index.
Significance of the HDI Report
|· The Human Development Report 2019 is significant because it focuses on inequalities in development.
· It shows inequalities beyond income which exist in society.
· It also measures loss in the human development progress due to inequalities.
· The report also highlights the gender gaps in development.
Criticisms of the HDI Report
|· Alleged less consideration of technological development or contributions to the human civilization.
· Focus exclusively on national performance and ranking.
· Less attention to development from a global perspective.
· Measurement error of the underlying statistics, and on the UNDP’s changes in formula which can lead to severe misclassification in the categorization of “low”, “medium”, “high” or “very high” human development countries.
|The other indices included in 2019 Report are:|
- Inequality-adjusted Human Development Index (IHDI)
- Gender Development Index (GDI)
- Multidimensional Poverty Index (MPI)
- Gender Inequality Index (GII) and
|Inequality- Adjusted Human Development Index (IHDI)|
- The IHDI shows percentage loss in HDI due to inequality.
- The IHDI combines a country’s average achievements in health, education and income with how those achievements are distributed among country’s population by “discounting” each dimension’s average value according to its level of inequality.
- Thus, the IHDI is distribution-sensitive average level of human development. Two countries with different distributions of achievements can have the same average HDI value.
- The HDI can be viewed as an index of ‘potential’ human development (or the maximum IHDI that could be achieved if there were no inequality)
- The index does not take into account several factors, such as the net wealth per capita or the relative quality of goods in a country. This situation tends to lower the ranking for some of the most advanced countries, such as the G7 members and others.
- Under perfect equality, the IHDI is equal to the HDI, but falls below the HDI when inequality rises.
- India’s 2020 position drop by one position to 130 (as compared to the HDI Index 2019- 129) with a score of 0.477. Although, the IHDI score has improved from 0.468 in 2018.
|Difference between IHDI and HDI|
- The difference between the IHDI and HDI is the human development cost of inequality, also termed – the overall loss to human development due to inequality.
- The IHDI allows a direct link to inequalities in dimensions, it can direct policies towards inequality reduction, and leads to better understanding of inequalities across population and their contribution to the overall human development cost.
- A recent measure of inequality in the HDI, the Coefficient of human inequality, is calculated as an unweighted average of inequality across three dimensions.
- The IHDI is calculated for 150 countries.
|Gender Development Index (GDI)|
- The GDI measures gender gaps in human development achievements by accounting for disparities between women and men in three basic dimensions of human development – health, knowledge and living standards using the same component indicators as in the HDI.
- The GDI shows how much women are lagging behind their male counterparts and how much women need to catch up within each dimension of human development.
- It is useful for understanding the real gender gap in human development achievements and is informative to design policy tools to close the gap.
- India is only marginally better than the South Asian average on the Gender Development Index (0.829 vs 0.828).
|Gender Inequality Index (GII)|
- Gender inequality remains a major barrier to human development.
- Girls and women have made major strides since 1990, but they have not yet gained gender equity. The disadvantages facing women and girls are a major source of inequality.
- All too often, women and girls are discriminated against in health, education, political representation, labour market, etc.—with negative consequences for development of their capabilities and their freedom of choice.
- The GII is built on the same framework as the IHDI – to better expose differences in the distribution of achievements between women and men.
- It measures the human development costs of gender inequality. Thus, the higher the GII value the more disparities between females and males and the more loss to human development.
- GII presents a composite measure of gender inequality using three dimensions:
- In GII, India is at 122 out of 162 countries. Neighbors China (39), Sri Lanka (86), Bhutan (99), Myanmar (106) were placed above India.
- Reproductive Health
- Measured by maternal mortality ratio and adolescent birth rates
- Economic status
- Expressed as labour market participation and measured by labour force participation rate of female and male populations aged 15 years and older.
- Empowerment measured by proportion of parliamentary seats occupied by females and proportion of adult females and males aged 25 years and older with at least some secondary education
- The report noted that group-based inequalities persist, especially affecting women and girls and no place in the world has gender equality.
- The report notes that the world is not on track to achieve gender equality by 2030 as per the UN’s Sustainable Development Goals (SDG – 5). It forecasts that it may take 202 years to close the gender gap in economic opportunity.
- The report presents a new “Social Norms Index” indicating how prejudices and social beliefs obstruct gender equality, which shows that only 14% of women and 10% of men worldwide have no gender bias.
- The report highlights that new forms of inequalities will manifest in future through climate change and technological transformation which have the potential to deepen existing social and economic fault lines.
|Multidimensional Poverty Index (MPI)|
- Index is developed by the Oxford Poverty and Human Development Initiative (OPHI) and the United Nations Development Programme (UNDP).
- MPI presents both the incidence and intensity of poverty and tracks 101 countries on deprivations across ten indicators in health, education, and standard of living
- MPI captures the multiple deprivations that people in developing countries face in their health, education and standard of living.
- India accounts for 28% of the 1.3 billion multidimensional poor.
- SDG – 1 – Ending poverty in all its forms, everywhere.
|Global Gender Gap Index|
- It is published by world economic forum (WEF) annually.
- It was first published in
- The Index benchmarks 153 countries on their progress towards gender parity in four dimensions:
- The Index aims to track progress on relative gaps between women and men on health, education, economy and politics
|Global Gender Gap Report 2020:|
- Globally, the average (population-weighted) distance completed to gender parity is at 68.6%, which is an improvement since the last edition. It will take 99.5 years to achieve full parity between men and women at the current rate of change.
- The largest gender disparity is in political empowerment. Only 25% of the 35,127 seats in parliaments around the world are occupied by women, and only 21% of the 3,343 ministers are women.
- Iceland has been the frontrunner on the Global Gender Gap Index for 11 years in a row. It has closed almost 88% of its gender gap, followed by Nordic neighbors Norway, Finland and Sweden.
- Yemen is ranked the worst (153rd), while Iraq is 152nd and Pakistan 151st.
|India- Specific Findings|
- India has slipped to the 112th spot from its 108th position in the last edition.
- India has been ranked below countries like China (106th), Sri Lanka (102nd), Nepal (101st), Brazil (92nd), Indonesia (85th) and Bangladesh (50th).
- Performance on Four Indicators: India has improved to 18th place on political empowerment but it has slipped to 150th on health and survival, to 149th in terms of economic participation and opportunity and to 112th place for educational attainment.
- Among the 153 countries studied, India is the only country where the economic gender gap (0.354) is larger than the political gender gap (0.411).
- India is among the countries with very low women representation on company boards (13.8%), while it was even worse in China (9.7%).
- On health and survival, four large countries -Pakistan, India, Vietnam and China – fare badly with millions of women there not getting the same access to health as men.
|World Bank’s Human Capital Index|
- The HCI has been constructed for 157 countries.
- It claims to seek to measure the amount of human capital that a child born today can expect to attain by age 18.
- The HCI index values are contended to convey the productivity of the next generation of workers, compared to a benchmark of complete standard education and full health.
- The HCI has three components:
|Survival||As measured by under-5 mortality rates|
Expected years of Quality-Adjusted School
|Which combines information on the quantity and quality of education (quality is measured by harmonizing test scores from major international student achievement testing programs and quantity from number of years of school that a child can expect to obtain by age 18 given the prevailing pattern of enrolment rates across grades in respective countries);|
|Health environment using:||a. Adult survival rates and
b. The rate of stunting for children under age 5.
|India’s neighbors in HDI-2019|
Sri Lanka (71) and China (85), Bhutan (134), Bangladesh (135), Myanmar (145), Nepal (147), Pakistan (152) and Afghanistan (170).
|Global scenario in HDI-2019|
- Norway, Switzerland, Ireland placed at the top three positions in that order.
- Globally, there are 3 billion poor people.
- Around 661 million of these poor people live in Asia and the Pacific.
- South Asia constitutes 41% of the world’s poor.