The first Human Development Index was introduced at the United Nations in 1990. Economist Mahbub ul Haq started working on this concept as far back as the 1970’s. He and other economists said that basing a person’s well-being on their countries GDP (Gross Domestic Product) was not a very good indicator, because it didn’t attribute for well-being of the individual. Gross Domestic Product looks at daily stock market results, consumer spending levels, and national debt figures. But these numbers provide only a partial view of how people are faring.
If Human Development’s definition is to be defined as the process of: “enlarging people’s freedoms and opportunities and improving their well-being. Human development is about the real freedom ordinary people have to decide who to be, what to do, and how to live.”
To develop the Human Development Index economists use Capabilities a person has to help determine the index. Capabilities are what people can do and what they can become-are the equipment one has to pursue a life of value. Basic capabilities valued by virtually everyone include: good health, access to knowledge, and a decent material standard of living. Other capabilities central to a fulfilling life could include the ability to participate in the decisions that affect one’s life, to have control over one’s living environment, to enjoy freedom from violence, to have societal respect, and to relax and have fun.
The Human Development Index was developed as an alternative to simple money metrics. It is an easy-to-understand numerical measure made up of what most people believe are the very basic ingredients of human well-being: health, education, and income.
Health: The most valuable capability people possess is to be alive. Advancing human development requires, first and foremost, expanding the real opportunities people have to avoid premature death by disease or injury, to enjoy protection from arbitrary denial of life, to live in a healthy environment, to maintain a healthy lifestyle, to receive quality medical care, and to attain the highest possible standard of physical and mental health.
Education/Knowledge: Access to knowledge is a critical determinant of long-term well-being and is essential to individual freedom, self-determination, and self-sufficiency. Education is critical to people’s real freedom to decide what to do and who to be. Education builds confidence, confers status and dignity, and broadens the horizons of the possible—as well as allowing for the acquisition of skills and credentials. Globalization and technological change have made it extraordinarily difficult for poorly educated Americans to achieve the economic self-sufficiency, peace of mind, and self-respect enabled by a secure livelihood.
Income: Income is essential to meeting basic needs like food and shelter—and to moving beyond these necessities to a life of genuine choice and freedom. Income enables valuable options and alternatives, and its absence can limit life chances and restrict access to many opportunities. Income is a means to a host of critical ends, including a decent education; a safe, clean living environment; security in illness and old age; and a say in the decisions that affect one’s life. Money isn’t everything, but it’s something quite important.
Most people would agree that a long and healthy life, access to knowledge, and a decent material standard of living are the basic building blocks of well-being and opportunity. They are also the building blocks of the American Human Development Index as well as the U.N. Human Development Index upon which it is modeled. These three core capabilities are universally valued around the world, and measurable, intuitively sensible, and reliable indicators exist to represent them—two critical considerations in the construction of a composite index.
The Human Development Index is now a measurement that we use to measure cities, states, and countries on.
I pose a question for you. I live in America. Looking at the Human Development Index we are ranked number 5 with a very high Human Development Index. Here is the link to the chart. http://en.wikipedia.org/wiki/List_of_countries_by_Human_Development_Index
The question! Are you taking advantage of all of the opportunities you have?
To your success and your future.