The Impact of the 2008 Global Crisis on Human Development: An Examination of the Human Assets Index

We examine the impact of the 2008 Global Crisis on 142 “Less-Developed” Countries as defined in Closset, Feindouno, and Goujon (2014). We look at the Human Assets Index (i.e. HAI), as well as each of its four components that include two health dimension indicators (i.e. the Undernourishment Index and the Under-five mortality index) and two education dimension indicators (i.e. the Adult Literacy Rate and the Secondary Enrollment Index). First, we look at how the index and each of its components have changed over the 1980-2011 period. We find that there has been a gradual improvement in all of the HAI indicators. Then, to examine the impact of the Global Crisis, we compare the three-year period just before the Global Crisis and the three-year period just after the Global Crisis. Our results show that, for the overall sample, the Global Crisis has not had a significant impact on any of the indicators. However, further examination reveals that the relatively developed countries within the sample have actually improved their HAIs after the crisis. Therefore, we conclude that crises tend to have different effects on a country’s development depending on how developed the country is before the crisis begins.