What is the best indicator of economic development?

Income per capita.
17% (21 votes)
The Human Development Index (HDI).
75% (95 votes)
The Inequality-adjusted Human Development Index (IHDI).
9% (11 votes)
Total votes: 127

Comments

The HDI take much more variables into account, as life expectation, educacion index... The income per capita is simpler and can put on the table an error image of a country, because is an average income divide by it total population. Don't take into account if the mayority of the income if in the hands of few people.

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The HDI was created to emphasize that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth alone. The HDI can also be used to question national policy choices, asking how two countries with the same level of GNI per capita can end up with different human development outcomes. These contrasts can stimulate debate about government policy priorities. 

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The human development index take into account the life expectancy and education.In a country there are people who have lots of money and people who haven't anything. That does not value income per capita. We must assess the standard of living of their citizens..

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Even though the income per capita might be easier to obtain, the HDI takes many more variables into account that can modify the result. When it comes to development in general there are many things that depend on each other. One country does not improve its situation changing only one aspect of its system (assuming this could be possible, which it isn't: any change affects other variables and has multiple consequences. The concept of an isolated change does not exit in real life). 

The economic development of the country is directly correlated to the human development, so the HDI is more complete to show how it is evolving. It should be more faithful to the reality than just calculating the income per capita (which can be altered by a country's inequality, showing a greater average income than the real one according to the different sectors of the population). 

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Nowadays countries exhibit different levels of development that are explained not only by the economic growth but also by the social and cultural factors.

The HDI is a sophisticated tool created by the United Nations which allows to track changes in development levels over time and to make comparisons between countries in this area. It measures the access the people have to wealth, jobs, education, nutrition, health, leisure and military security and human safety. The index also shows that countries with lots of income do not always spend that money in ways that create high life expectancies or education levels… so in this way we can say that despite being a measure easy to obtain, it’s not enough to show the reality.

For instance, according to last year HDI report, Qatar has one of the highest income per capita in the world but it’s on 31st position of human development and  Norway has only half the income that Qatar has and is in first position.

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If I had to choose between the Income per Capita and The Human Development Index, I would say that the best indicator of economic development is the second one. My opinion is based on the reason that although the income per capita is a well-considered indicator of economic development, it can show results, that besides of being apparently very good (high levels of income); are hiding an unequal way of wealth-share in the country. However, by using the Human Development Index a lot of different issues are taken into account, not only the income, helping to picture a most accurate image of the situation of any concrete area.

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The ideal would be to use the Human Development Index (HDI) since it is calculated by UNDP from indicators for health, education and living standards, which would also include the renta per capita. Thus, the multidimensional character of the HDI makes it a better option to measure economic development over  GDP. However, the HDI in 2012, 2011 and 2013 included only 187 countries since reliable data related to the three dimensions mentioned beforehand must be provided. Hence, the HDI itself is not enough to explain economic development. Other indexes as could be the Multidimensional Poverty Index should be taken into account. Furthermore, in 2010 the HDI changed its measurements. Then, adult literacy stopped being considered insufficient and it was changed to level of education of the whole population.

In summary, the HDI is empirically a better option against the GDP. Nevertheless it is still less widely available.

As Mahbub ul Haq –founder of the Human Development Report- pointed out “ People are the real wealth of a nation”

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income per capita does not mean that every person of the population gets that amount of money. it is just generally estimated, but in real situation there could be extremely rich high class and a lot of poor people. Thus, better way to identify economic development is to look at Human development index, which gives more detailed information about life conditions of people like life expectancy, level of education and etc.

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Income per capita is just an estimation, a math operation to divide the total amount of goods and services between the population of this country. So for me it doesnt means that we have a good or a bad economic development, its also true that if we have a good Income per capita is more likely that we can reach that economic develpment but no for sure. The "IHDI" neither means that we have a good develpment because if everybody´s poor we have a low inequialty level. SO we have to choice the "HDI"

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The most comprehensive measure of overall economic performance is gross domestic product or GDP, which measures the “output” or total market value of goods and services produced in the domestic economy during a particular time period. GDP is probably the best measure of the overall condition of the economy because it includes the output of all sectors of the economy. It is common to use the quarterly real GDP series (nominal GDP adjusted to remove the effects of inflation) to determine the timing of business cycle expansions and recessions, although the National Bureau of Economic Research uses more timely monthly indicators to determine official business cycle dates. 

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