What Does the Human Development Index Measure?

There’s been some interesting recent commentary on the Human Development Index. But first, some background. This index is calculated each year by the U.N. Development Program as a summary indicator of “Human Development,” combining data on life expectancy at birth, adult literacy, educational enrollment, and average income (measured as G.D.P. per capita). And earlier this week, Catherine Rampell noted a recent effort by the SSRC-funded American Human Development Project to develop a Human Development Index, for U.S. states. Philosophically, it is an attempt to broaden the development debate beyond G.D.P. But does it succeed?
Andrew Gelman isn’t convinced by this effort. Over at fivethirtyeight.com, he takes a close look at this new state-based index, comparing a state’s ranking in this new state-based human development measure and its ranking on average income. He finds yields an 86 percent correlation. Forget the high-falutin’ language of “human development,” Gelman argues, “You’re pretty much just mapping state income and giving it a fancy transformation and a fancy new name.” Over at Economix, Catherine Rampell responded, noting that the “U.N.’s index was not designed to capture the levels of variation that would occur within a single country. It was designed to make international comparisons.”
Given this debate, I wondered whether Gelman’s critique might also apply to the U.N.’s original cross-national Human Development Index, so I downloaded the latest data. The graph below compares a country’s ranking on the human development index with its ranking on average income. The correlation between the two is even stronger — a massive 95 percent! For all but a handful of countries, your ranking on average income is the same as your ranking on this multi-dimensional index.

For comparison, here’s Gelman’s graph for U.S. states. (The only way in which it differs is that Gelman gives the richest state the lowest ranking, rather than the highest ranking.)

For all the work that goes into the Human Development Index, it just doesn’t tell you much that you wouldn’t learn from simple comparisons of G.D.P. per capita. But you do get the veneer of something broader, with a normatively loaded name for this index.
But there’s another reason to be suspicious of the state-based human development index. Some commentators have been comparing the scores of individual states on the state-based index with the international index, which yields newsworthy bites, like “Mississippi has an H.D.I. level roughly on par with that of Turkey.” But the two indices aren’t comparable. Dig deep into the methods used to construct the AHDP’s state-based index, and you’ll find that not only are the inputs different, but so are the formulae. In principle, one could build indices to compare Mississippi and Turkey, but comparing different indices is comparing apples and oranges.
Economix has a longer discussion on the relevant data issues, here.