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Using Meta-goal Programming for a New Human Development Indicator with Distinguishable Country Ranks

Author

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  • Hussein Sayed
  • Ramadan Hamed
  • Mohamed Ramadan
  • Samaa Hosny

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Abstract

This paper builds on the extensive literature of the benefit-of-the-doubt (BoD) methodology to set weights for composite indicators (CIs). The proposed methodology, meta-goal programming benefit of the doubt (MGP-BoD), proved to overcome some of the BoD shortcomings and enhance its performance. MGP-BoD belongs to the family of common-weights BoD models. It comprises of two sets of goals and two meta-goals. Among other merits, results prove two additional benefits of the MGP-BoD over older BoD. First, it enhances BoD discriminating power by eliminating all ties in CI values and, hence, country ranks. This high discriminating power is achieved in only one totally endogenous step. Second, MGP-BoD weights add up to one. This makes weights more insightful, interpretable, comparable to weights from other weighting systems, and easier to interpret compared to BoD. These additional merits favor MGP-BoD over previous weighting methods. In the meantime, the proposed method preserves a significantly high correlation with previous methods results as shown a set of Pearson and Spearman correlation tests to compare it to various previous methodologies. To validate the proposed methodology, it has been thoroughly tested using sensitivity and classification analyses. All tests are found highly significant. Nevertheless, the method has its own limitations that suggest future research points. Finally, the paper offers a new human development indicator (HDI) using 2012 data using MGP-BoD. The proposed HDI offers an alternative to the currently used equal-weights HDI that offers distinguishable country ranks and more policy-guiding weights. The highest weights are assigned to education variables. Copyright Springer Science+Business Media Dordrecht 2015

Suggested Citation

  • Hussein Sayed & Ramadan Hamed & Mohamed Ramadan & Samaa Hosny, 2015. "Using Meta-goal Programming for a New Human Development Indicator with Distinguishable Country Ranks," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 123(1), pages 1-27, August.
  • Handle: RePEc:spr:soinre:v:123:y:2015:i:1:p:1-27
    DOI: 10.1007/s11205-014-0723-6
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    References listed on IDEAS

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    1. Blancard, Stéphane & Hoarau, Jean-François, 2013. "A new sustainable human development indicator for small island developing states: A reappraisal from data envelopment analysis," Economic Modelling, Elsevier, vol. 30(C), pages 623-635.
    2. Hatefi, S.M. & Torabi, S.A., 2010. "A common weight MCDA-DEA approach to construct composite indicators," Ecological Economics, Elsevier, vol. 70(1), pages 114-120, November.
    3. Chris Tofallis, 2013. "An automatic-democratic approach to weight setting for the new human development index," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(4), pages 1325-1345, October.
    4. Cristina Bernini & Andrea Guizzardi & Giovanni Angelini, 2013. "DEA-Like Model and Common Weights Approach for the Construction of a Subjective Community Well-Being Indicator," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 114(2), pages 405-424, November.
    5. Mishra, SK, 2008. "On construction of robust composite indices by linear aggregation," MPRA Paper 9232, University Library of Munich, Germany.
    6. Undp, 2010. "HDR 2010 - The Real Wealth of Nations: Pathways to Human Development," Human Development Report (1990 to present), Human Development Report Office (HDRO), United Nations Development Programme (UNDP), number hdr2010, December.
    7. Laurens Cherchye & Willem Moesen & Nicky Rogge & Tom Puyenbroeck, 2007. "An Introduction to ‘Benefit of the Doubt’ Composite Indicators," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 82(1), pages 111-145, May.
    8. Zhou, P. & Ang, B.W. & Poh, K.L., 2007. "A mathematical programming approach to constructing composite indicators," Ecological Economics, Elsevier, vol. 62(2), pages 291-297, April.
    9. Ernest Reig-Martínez, 2013. "Social and Economic Wellbeing in Europe and the Mediterranean Basin: Building an Enlarged Human Development Indicator," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 111(2), pages 527-547, April.
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    Cited by:

    1. Michela Gnaldi & M. Giovanna Ranalli, 2016. "Measuring University Performance by Means of Composite Indicators: A Robustness Analysis of the Composite Measure Used for the Benchmark of Italian Universities," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 129(2), pages 659-675, November.
    2. repec:spr:soinre:v:136:y:2018:i:3:d:10.1007_s11205-016-1500-5 is not listed on IDEAS

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