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Human Development Rankings Based on the Pareto Dominance: Illustrations Using Cross-country Panel Data 1980-2007

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  • Maki Michinaka
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    Abstract

    This paper aims (a) to propose two types of human development rankings, a maximal order ranking (MAXOR) and a minimal order ranking (MINOR), and (b) to examine the characteristics of these rankings by using the ranking results derived from the balanced and unbalanced cross-country panel datasets for the period 1980 to 2007. As a means of illustration, I compare these ranking characteristics and results to those of the human development index (HDI), one of the most prevalent human development measurement tools. The MAXOR and MINOR ranking results have a high correlation with the HDI ranking. However, unlike the HDI, the MAXOR and MINOR do not have to undergo aggregation or indexation when their rankings are being generated. Consequently, they successfully eliminate some of the arbitrariness that is implicit in other existing rankings. The MAXOR and MINOR ranking results are comparatively vaguer than those of other typical rankings such as the HDI in that multiple observations are often ranked identically. However, this vagueness also presents the possibility that these rankings will gain wide acceptance. From 1980 to 2007, the number of rank groups and the distributions of the countries of the MAXOR and MINOR were relatively robust to changes in the total number of countries. This means that a rank order for a specific country in the MAXOR or MINOR shows its relative position against all other countries, regardless of the year in which the country is set and the number of countries. In this sense, these rankings are more appropriate for tracing the historical transition of each country compared to other typical rankings.

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    File URL: http://gcoe.ier.hit-u.ac.jp/research/discussion/2008/pdf/gd11-188.pdf
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    Bibliographic Info

    Paper provided by Institute of Economic Research, Hitotsubashi University in its series Global COE Hi-Stat Discussion Paper Series with number gd11-188.

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    Date of creation: Apr 2011
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    Handle: RePEc:hst:ghsdps:gd11-188

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    Keywords: multidimensional poverty measurement; Pareto dominance; ranking; Human Development Index (HDI);

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    References

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    1. Laurens Cherchye & Erwin Oghe & Tom Van Puyenbroeck, 2005. "Robust human development rankings," Public Economics Working Paper Series ces0516, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Working Group Public Economics.
    2. Maki Michinaka & Takahiro Ito, 2010. "Multidimensional Poverty Rankings based on Pareto Principle: A Practical Extension," Global COE Hi-Stat Discussion Paper Series gd10-139, Institute of Economic Research, Hitotsubashi University.
    3. Gustav Ranis & Frances Stewart & Emma Samman, 2005. "Human Development: Beyond the HDI," Working Papers 916, Economic Growth Center, Yale University.
    4. Dasgupta, Partha & Weale, Martin, 1992. "On measuring the quality of life," World Development, Elsevier, vol. 20(1), pages 119-131, January.
    5. Farhad Noorbakhsh, 1998. "The human development index: some technical issues and alternative indices," Journal of International Development, John Wiley & Sons, Ltd., vol. 10(5), pages 589-605.
    6. Shyamal Chowdhury & Lyn Squire, 2006. "Setting weights for aggregate indices: An application to the commitment to development index and human development index," The Journal of Development Studies, Taylor and Francis Journals, vol. 42(5), pages 761-771.
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