1. 4.2 Measuring Development
Chapter 28

2. Learning Objectives [4.2 Economic Indicators]
Single indicators:
Distinguish between GDP & GNI per capita figures (incl. PPP) for MDCs and LDCs.
Compare and contrast two health (and two education) indicators for MDCs and LDCs.
Composite indicators: p
State why composite indicators are better
Compare & contrast the HDI figures for MDCs & LDCs.
Explain why a country’s GDP/GNI per capita global ranking may differ from its HDI ranking.

3. Various statistics of Economic growth Note the usefulness of each (see 3.1) (and which are best for LDCs?)
GDP – Gross Domestic Product
The value of output produced within a country during a time period
GNP/I – Gross National Product/Income
The value of output produced within a country plus net income from abroad
Real GDP
Accounts for differences in price levels in different countries
Real GDP per capita
Takes account of the size of the population
Real GDP per capita PPP
Measures the purchasing power of a basket of goods in domestic currency after converting from USD.

4. How can the multidimensional nature of Economic Development be measured?
How does one go about measuring these aspects?
major aspects of development
What possible statistic?
Political freedoms
Basic sustenance
A clean, natural environment
Access to health and education
A “just society”
A safe and secure country
“A life that one has reason to value”

5. Examples of indicators: Link each indicator to an aspect/dimension of development
Indicator: ratio of the richest 10% to lowest 10% Indicator: child dependency ratio Indicator: Agriculture as % of GDP Indicator: Electricity consumption per capita Indicator: Carbon dioxide emissions per capita Indicator: Daily supply of calories per capita Indicator: Internet subscribers per 1000 people

6. Human Development Index
The HDI attempts to measure three aspects of human welfare (each weighted as 1/3 of the index) using 4 indicators:
Health – life expectancy at birth component
Education – mean of years of schooling for adults aged 25 years , expected years of schooling for children of school entering age
Standard of living – GNI per capita (PPP$)

7. The indicators are then evaluated against the “ideal” statistic which is rated as With all four indicators, the HDI is a value also between The closer a country’s value is closer to one, the more developed the country is.
The UN assigns value into 4 categories: data below are from the 2013 UNDR
Very high human development  >0.9
High human development > < 0.9
Medium human development > < 0.75
Low human development < 0.5

8. Task: explain the validity of the four indicators for HDI
Rephrase an indicator in your own words
What assumption is involved that links it to its “aspect”?
Explain why this aspect is a valid measure of human welfare
Repeat steps 1-3 for the other four indicators

9. Task: compare Data http://hdr.undp.org/en/data/profiles/
Compare 2 medium HDI countries with 2 very high HDI countries in regard to:
Two health indicators of your choice
Two education indicators of your choice
GNI/capita PPP and HDI
Is your country an LDC? Justify your answer in a short paragraph.