IDEAS home Printed from https://ideas.repec.org/p/jrp/jrpwrp/2020-015.html
   My bibliography  Save this paper

What is Inclusive Development? Introducing the Multidimensional Inclusiveness Index

Author

Listed:
  • Christoph Dörffel

    (Friedrich Schiller University Jena)

  • Sebastian Schuhmann

    (Friedrich Schiller University Jena)

Abstract

Despite successes in mitigating global poverty, there is a growing objection against addressing development policies in many countries fed by the feeling of growing inequalities. Thus, development should be more "inclusive". The purpose of this paper is to address two major shortcomings of previous literature: First, a lacking agreement about what constitutes inclusiveness. Although the concept overall is not unambiguous, we show it needs to be human-centered at its core. Second: A suitable measurement for development. Prominent previous approaches like the Human Development Index (HDI) and Inclusive Development Index (IDI) have major conceptual drawbacks and lacking data availability. We create the Multidimensional Inclusiveness Index (MDI) that we deem conceptually more appropriate and that is available for a 50% larger sample than the HDI. The MDI is calculated in three versions for up to 171 countries for the years 1960-2018. For the aggregation of the two subindices that constitute the MDI - one on development equity and one on absolute development achievements - we avoid value judgements by applying principal component analysis. Subsequently, we chose a geometric aggregation method to calculate the MDI. We show that the MDI captures regional development patterns and that major events such as regime changes or genocides are reflected in country trends. Despite correlations resulting from the similarities in the data included, the larger set of information included in the MDI provide new insight when compared to the HDI, GDP or IDI data; its data availability is much larger compared to the HDI and IDI. The distinction into achievements and equity subindices delivers important information to disentangle countries’ performance in both dimensions. In the 2018 MDI ranking, top ranks are dominated by European countries, many Sub-Saharan African countries can be found on lower ranks. Over time, the global averages for all three MDI versions are increasing. This positive trend is largely driven by improvements in the achievements dimension. Equity consideration deserve a stronger emphasis in development concepts. However, last years’ trend in the equity dimension are optimistic.

Suggested Citation

  • Christoph Dörffel & Sebastian Schuhmann, 2020. "What is Inclusive Development? Introducing the Multidimensional Inclusiveness Index," Jena Economics Research Papers 2020-015, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2020-015
    as

    Download full text from publisher

    File URL: https://oweb.b67.uni-jena.de/Papers/jerp2020/wp_2020_015.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dollar, David & Kraay, Aart, 2002. "Growth Is Good for the Poor," Journal of Economic Growth, Springer, vol. 7(3), pages 195-225, September.
    2. Angus Deaton, 2008. "Income, Health, and Well-Being around the World: Evidence from the Gallup World Poll," Journal of Economic Perspectives, American Economic Association, vol. 22(2), pages 53-72, Spring.
    3. 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.
    4. Michela Nardo & Michaela Saisana & Andrea Saltelli & Stefano Tarantola & Anders Hoffman & Enrico Giovannini, 2005. "Handbook on Constructing Composite Indicators: Methodology and User Guide," OECD Statistics Working Papers 2005/3, OECD Publishing.
    5. World Economic Forum, 2017. "The Inclusive Growth and Development Report 2017," Working Papers id:11638, eSocialSciences.
    6. Suman Seth & Antonio Villar, 2014. "Human Development, Inequality and Poverty: empirical findings," Working Papers 14.11, Universidad Pablo de Olavide, Department of Economics.
    7. Sudhir Anand & Amartya Sen, 2000. "The Income Component of the Human Development Index," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 1(1), pages 83-106.
    8. Sudhir Anand and Amartya Sen, 2000. "The Income Component of Human Development Index," Human Development Occasional Papers (1992-2007) HDOCPA-2000-01, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
    9. Christoph Lakner & Branko Milanovic, 2016. "Global Income Distribution: From the Fall of the Berlin Wall to the Great Recession," The World Bank Economic Review, World Bank Group, vol. 30(2), pages 203-232.
    10. Shaohua Chen & Martin Ravallion, 2010. "The Developing World is Poorer than We Thought, But No Less Successful in the Fight Against Poverty," The Quarterly Journal of Economics, Oxford University Press, vol. 125(4), pages 1577-1625.
    11. Ravallion, Martin & Chen, Shaohua, 2003. "Measuring pro-poor growth," Economics Letters, Elsevier, vol. 78(1), pages 93-99, January.
    12. Axel Dreher, 2006. "Does globalization affect growth? Evidence from a new index of globalization," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1091-1110.
    13. Rahul Anand & Mr. Saurabh Mishra & Mr. Shanaka J Peiris, 2013. "Inclusive Growth: Measurement and Determinants," IMF Working Papers 2013/135, International Monetary Fund.
    14. Rainer Winkelmann, 2009. "Unemployment, Social Capital, and Subjective Well-Being," Journal of Happiness Studies, Springer, vol. 10(4), pages 421-430, August.
    15. Nanak Kakwani & Hyun H. Son, 2008. "Poverty Equivalent Growth Rate," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 54(4), pages 643-655, December.
    16. Sudhir Anand and Amartya Sen, 1994. "Human development Index: Methodology and Measurement," Human Development Occasional Papers (1992-2007) HDOCPA-1994-02, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
    17. Sagar, Ambuj D. & Najam, Adil, 1998. "The human development index: a critical review," Ecological Economics, Elsevier, vol. 25(3), pages 249-264, June.
    18. Solt, Frederick, 2019. "Measuring Income Inequality Across Countries and Over Time: The Standardized World Income Inequality Database," SocArXiv mwnje, Center for Open Science.
    19. Suman Seth & Antonio Villar, 2014. "Human Development, Inequality and Poverty: empirical findings," Working Papers 14.11, Universidad Pablo de Olavide, Department of Economics.
    20. Joyeeta Gupta & Nicky R M Pouw & Mirjam A F Ros-Tonen, 2015. "Towards an Elaborated Theory of Inclusive Development," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 27(4), pages 541-559, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Christoph Doerffel & Peter Draper & Andreas Freytag & Sebastian Schuhmann, 2021. "Drivers of Inclusive Development: An Empirical Investigation," Jena Economics Research Papers 2021-015, Friedrich-Schiller-University Jena.
    2. Muhammad Kamran & Muhammad Zahid Rafique & Abdul Majeed Nadeem & Sofia Anwar, 2023. "Does Inclusive Growth Contribute Towards Sustainable Development? Evidence from Selected Developing Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 165(2), pages 409-429, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Christoph Dörffel & Sebastian Schuhmann, 2022. "What is Inclusive Development? Introducing the Multidimensional Inclusiveness Index," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 162(3), pages 1117-1148, August.
    2. Albino Prada & Patricio Sánchez-Fernández, 2019. "Transforming Economic Growth into Inclusive Development: An International Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 145(1), pages 437-457, August.
    3. Leandro Prados de la Escosura, 2021. "Augmented human development in the age of globalization," Economic History Review, Economic History Society, vol. 74(4), pages 946-975, November.
    4. Mustafa, Ghulam & Rizov, Marian & Kernohan, David, 2017. "Growth, human development, and trade: The Asian experience," Economic Modelling, Elsevier, vol. 61(C), pages 93-101.
    5. Laurens Cherchye & Erwin Ooghe & Tom Puyenbroeck, 2008. "Robust human development rankings," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 6(4), pages 287-321, December.
    6. Diogo Ferraz & Enzo B. Mariano & Daisy Rebelatto & Dominik Hartmann, 2020. "Linking Human Development and the Financial Responsibility of Regions: Combined Index Proposals Using Methods from Data Envelopment Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 150(2), pages 439-478, July.
    7. Sabina Alkire, James Foster, 2010. "Designing the Inequality-Adjusted Human Development Index (HDI)," OPHI Working Papers 37, Queen Elizabeth House, University of Oxford.
    8. Débora Pereira & Caroline Mota, 2016. "Human Development Index Based on ELECTRE TRI-C Multicriteria Method: An Application in the City of Recife," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(1), pages 19-45, January.
    9. Clare Leaver & Paul Segal, 2014. "The Global Distribution of Income," Economics Series Working Papers 714, University of Oxford, Department of Economics.
    10. Panagiotis Ravanos & Giannis Karagiannis, 2021. "A VEA Benefit-of-the-Doubt Model for the HDI," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 155(1), pages 27-46, May.
    11. Jeni Klugman & Francisco Rodríguez & Hyung-Jin Choi, 2011. "The HDI 2010: new controversies, old critiques," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 9(2), pages 249-288, June.
    12. Isaac K. Ofori, 2021. "Towards Building Shared Prosperity in Sub-Saharan Africa: How Does the Effect of Economic Integration Compare to Social Equity Policies?," Research Africa Network Working Papers 21/045, Research Africa Network (RAN).
    13. Leandro Prados de la Escosura, 2023. "Inequality Beyond GDP: A Long View," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(3), pages 533-554, September.
    14. Elizabeth Stanton, 2007. "The Human Development Index: A History," Working Papers wp127, Political Economy Research Institute, University of Massachusetts at Amherst.
    15. Higgins, Sean & Lustig, Nora, 2016. "Can a poverty-reducing and progressive tax and transfer system hurt the poor?," Journal of Development Economics, Elsevier, vol. 122(C), pages 63-75.
    16. GOH, Chor-ching & LUO, Xubei & ZHU, Nong, 2009. "Income growth, inequality and poverty reduction: A case study of eight provinces in China," China Economic Review, Elsevier, vol. 20(3), pages 485-496, September.
    17. Martin Ravallion, 2016. "Are the world’s poorest being left behind?," Journal of Economic Growth, Springer, vol. 21(2), pages 139-164, June.
    18. Attari, Muhammad Qasim & Pervaiz, Dr. Zahid & Jan, Dr. Sajjad Ahmad, 2017. "Temporal and Spatial Variations in Human Development Across the Districts of Punjab, Pakistan," MPRA Paper 89092, University Library of Munich, Germany.
    19. Aadil Hameed Shah & Atta Ullah Khan & Liurong Pan & Asad Amin & Abbas Ali Chandio, 2022. "Reflections of Pro-Poor Growth across Agro-Climatic Zones for Farming and Non-Farming Communities: Evidence from Punjab, Pakistan," IJERPH, MDPI, vol. 19(9), pages 1-16, May.
    20. Nicolas Ruiz, 2018. "Measuring The Joint Distribution Of Household’S Income, Consumption And Wealth Using Nested Generalized Mean," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(03), pages 759-785, June.

    More about this item

    Keywords

    index; multidimensional; inclusiveness; inclusive development;
    All these keywords.

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jrp:jrpwrp:2020-015. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Markus Pasche (email available below). General contact details of provider: http://www.jenecon.de .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.