Lopez-Calva, Luis F., and Eduardo Ortiz-Juarez (2010). "A Household-based, Distribution-Sensitive HDI: Empirical Application to Mexico, Nicaragua and Peru" Paper presented at the 7th annual conference of the HDCA, 21-23 September 2010, Amman, Jordan.

In the light of a growing interest in examining the concept of human development and the calculation of the HDI, one of the main concerns relate to the inclusion of inequality. This paper proposes a straightforward way to estimate a household-based distribution-sensitive HDI by applying generalized means based on the class of indices by Foster, et al. (2005). The empirical illustration shows that the loss in human development due to inequality can reach up to 22%, 29% and 57% at the national level in Mexico, Peru and Nicaragua, respectively. Among dimensions the loss in the income index can reach up 61% in Nicaragua, while the education index appears as the most sensitive in the case of Mexico and Peru, with a percentage of loss between 38% and 48%. Overall, the estimations evidence a higher sensitivity of the HDI to inequality, and therefore an important space for public action.