Biggeri, Mario (1); Mauro, Vincenzo (2) (2017). 'Measuring Sustainable Human Development: Analysing Patterns Across Countries throughout the Multidimensional Human Development Index' Paper presented at the annual conference of the HDCA, Cape Town 2017.
Measuring multidimensional development of countries is a core issue in current international debate on sustainable Human Development (HD) and to target and monitor the Sustainable Development Goals and the 2030 agenda.
Sustainable HD can be defined as a process of promotion and expansion of valuable opportunities/capabilities (Sen, 1999; Anand and Sen, 2000; Biggeri and Ferrannini, 2014) and it is considered as a policy objective for UNDP (United Nations Development Programme) and other development agencies as well as for several countries.
In order to synthesise multidimensional human development outcomes, different approaches have been proposed in the empirical literature (Anand and Sen, 1997; Bourguignon and Chakravarty, 2003; Ranis et al. 2006; Klugman et al. 2011; Alkire and Foster, 2011). The Human Development Index (HDI) is the pivotal indicator of sustainable HD paradigm and it is still recognized to hold a relevant role in political terms in the development arena versus the GDP primacy (Klugman et al. 2011, p. 7-8).
Despite the large literature on the HDI, there are some relevant issues that deserve attention both from a theoretical and empirical perspective. First, the construction of the HDI was driven to a great extent by the cross-country data available in 1990, as well as the need to generate a simple compelling policy message. As underlined by many researchers, it does not include all capabilities that might be of interest (Fukuda-Parr, 2000). Indeed, the 2010 HDR makes a strong case for the consideration of several process freedoms in the discussion of human development. Furthermore, issues about substitutability between dimensions were raised since the beginning by several authors (e.g. Desai, 1991), who pointed out that the level of priority to be given to a dimension was invariant to the level of attainments. The new HDI substitutes the arithmetic mean of the three components with the geometric mean (UNDP, 2013). This new approach adds relevant properties such as the “penalisation” of countries’ heterogeneous outcomes (also referred to as “prioritization”) (Klugman et al. 2011). Despite this substantial improvement both theoretical and empirical, this method could still present some problems especially if the number of dimensions increases (Ranis and Stewart, 2010). For example, as acknowledged by the authors, if some of the components are zero (or close to zero), the geometric mean conduces to some well-known problems of calculations and interpretability (Klugman et al. 2011, p.24).
The aim of this paper is to introduce the Multidimensional Human Development Index (MHDI) a method to allow researchers and practitioners to expand the classical HDI dimensions penalising heterogeneity by applying the Multidimensional Synthesis of Indicators (MSI) approach introduced by Mauro et al. (2016).
The MSI is a class of functions that allows a general statistical procedure to aggregate different dimensions of human development into a uni-dimensional index. The level of priority to be given to a dimension is connected to the overall level of attainments. It has some significant advantages in relation to what has been put forward by the HDRO (Human Development Research Office) since it overcomes the technical problems encountered by the new HDI while partially addressing the so-called “inescapable arbitrariness” in the choice of the degree of the mean issue discussed by Anand and Sen (1997) as well as opening to exploration further the link between human freedom and human development.
The procedure of aggregation of different dimensions entails many different phases. Despite their relevance, this chapter is therefore not going to focus on some key issues such as the process of selection of dimensions, their transformation, the implicit weighting issue, the harmonisation of indicators and the inequality issue. In this chapter we focus only on the aggregation function, presenting an empirical example with six dimensions.
The paper is structured into six parts. In the second section, we further introduce the sustainable HD theoretical perspective. In the third section, we present the MHDI. In the fourth section an example with real data at country level is reported as an illustration. In section five, the pattern of MHDI a selected number of countries is presented and analysed, while in the conclusions the main findings are remarked.
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