The concept of sustainable development does imply limits—not absolute limits but limitations imposed by the present state of technology and social organization on environmental resources and by the ability of the biosphere to absorb the effects of human activities. CP551 Sustainable Development (3 credits) 18 Jan 2008 R. Shanthini Source: Our Common Future (1987)

Module 2: Concepts of economic development & human development. Economic development indices & their critique. Human development index & its critique. Discussion on sustainable development indices. 18 Jan 2008 R. Shanthini

Module 2: Concepts of economic development & human development. Economic development indices & their critique. Human development index & its critique. Discussion on sustainable development indices. 18 Jan 2008 R. Shanthini

Concepts of economic development & human development: 18 Jan 2008 R. Shanthini What is economic development? Why do we need economic development? What is the cost of economic development? What is human development? Does economic development help human development? If yes, in which way?

Module 2: Concepts of economic development & human development. Economic development indices & their critique. Human development index & its critique. Discussion on sustainable development indices. 18 Jan 2008 R. Shanthini

Economic development indices 18 Jan 2008 R. Shanthini care of the environment stable job well paid job long life life free of avoidable morbidity low inflation low infant mortality high GDP per capita adequate housing good income distribution good education level adequate nutrition free markets civil liberties Source: Montenegro, A., An Economic Development Index,

Economic development indices 18 Jan 2008 R. Shanthini care of the environment stable job well paid job long life life free of avoidable morbidity low inflation low infant mortality high GDP per capita adequate housing good income distribution good education level adequate nutrition free markets civil liberties Source: Montenegro, A., An Economic Development Index, measured by Gini Index

Gini Index is a measure of income distribution in a country 18 Jan 2008 R. Shanthini Gini Index = 0 means absolute equality (GI = 25% for Sweden in 2000 GDP per capita = 32,525 PPP US$ in 2005) Gini Index = 100 means absolute inequality (GI = 40.8% for US in 2000 GDP per capita = 41,890 PPP US$ in 2005) Source: HDR2007/08,

18 Jan 2008 R. Shanthini GDP per capita (PPP US$) 2005 Gini Index Luxembourg 60,228- United States 41, Norway 41, Ireland 38, Iceland 36,510- Switzerland 35, Hong Kong, China (SAR) 34, Denmark 33, Austria 33, Canada 33, Source: HDR2007/08,

18 Jan 2008 R. Shanthini GDP per capita (PPP US$) 2005 Gini Index Denmark 33, Japan 31, Sweden 32,52525 Czech Republic 20, Norway 41, Slovakia 15, Bosnia and Herzegovina 7, Finland 32, Hungary 17, Ukraine 6, Source: HDR2007/08,

18 Jan 2008 R. Shanthini Source: HDR2007/08,

18 Jan 2008 R. Shanthini Source: HDR2007/08,

GDP per capita is an average measure, and it alone does not represent the economic status of an average citizen in a country 18 Jan 2008 R. Shanthini Gini Index must be incorporated into GDP per capita to get a good idea of the economic status of an average citizen in a country

How to do that? See Hicks, D. (1997) ‘The inequality- adjusted human development index: a constructive proposal.’ World Development 25: Jan 2008 R. Shanthini

What else could be done to improve the measure of economic development which could truly reflect the economical status of an average citizen? 18 Jan 2008 R. Shanthini Why worry about only the economical status?

What about all these? 18 Jan 2008 R. Shanthini care of the environment stable job well paid job long life life free of avoidable morbidity low inflation low infant mortality high GDP per capita adequate housing good income distribution good education level adequate nutrition free markets civil liberties Source: Montenegro, A., An Economic Development Index,

Module 2: Concepts of economic development & human development. Economic development indices & their critique. Human development index & its critique. Discussion on sustainable development indices. 18 Jan 2008 R. Shanthini

Human development Indices: 18 Jan 2008 R. Shanthini Level of Living Index (Drewnowski and Scott, 1966) includes nutrition, housing, health, education, environment, and others PQLI: Physical Quality of Life Index (Morris, 1970) includes infant mortality, literacy rates and life expectancy QLI: Quality of Life Index (Ferrans and Powers, 1980) includes health and functioning, psychological/spiritual domain, social and economic domain, and family)

18 Jan 2008 R. Shanthini GNH: Gross National Happiness (Jigme Singye Wangchuck, 1972) GPI: Genuine Progress Indicator HDI: Human Development Index (UNDP, 1990) includes literacy rate, longevity, school enrolment and GDP per capita and much more…… Human development Indices (continued):

18 Jan 2008 R. Shanthini Take a close look at Human Development Index (HDI)