As we've discussed in previous blogs, the current standard of GDP per capita is insufficient when it comes to gauging the prosperity of a nation's people. This underscores the need for a more comprehensive indicator. But what would this entail?
To assess a citizen's prosperity, we can look into three factors: their health, education level and income. The indicators corresponding to these three factors are life expectancy as measured at birth, average years of schooling for a person aged 25, and GNI per capita. These three indicators are factored and scaled to a number ranging from 0 to 1. The closer it is to 1, the better the score.
This holistic indicator is called the Human Development Index or HDI. It was invented by the UN in 1990; they also release a Human development report each year ranking countries based on their HDI scores.
The top five countries, as per the 2022 report, in order, are Switzerland, Norway, Iceland, Hong Kong and Denmark. The bottom five, in order, are Niger, Chad, CAR, South Sudan, and Somalia. As expected, European countries top the list while Sub-Saharan countries are trailing behind.
The UNDP, United Nations Development Programme, in charge of compiling this data, releases a comprehensive, magazine-style report on all the considerations, trends and predictions that go alongside such an indicator.
I will read the report in the future and try to make sense of it.
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