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A Multivariate Analysis of the Human Development Index

Author

Listed:
  • Basudeb Biswas
  • Frank Caliendo

Abstract

A multivariate technique called principal component analysis is used to combine measures of human development. The first principal component index is the linear combination of component indexes with maximal information content. This multivariate technique accounts for differences in the variances of component indexes as well as interdependence among the component indexes. The first principal component of the three indexes used in the HDI (life expectancy, education, GDP) yields rankings nearly identical to the HDI itself. We interpret this as theoretical support for the HDI ranking system as a metric of international human development.

Suggested Citation

  • Basudeb Biswas & Frank Caliendo, 2002. "A Multivariate Analysis of the Human Development Index," Working Papers 2002-11, Utah State University, Department of Economics.
  • Handle: RePEc:usu:wpaper:2002-11
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    File URL: ftp://repec.bus.usu.edu/RePEc/usu/pdf/ERI2002-11.pdf
    File Function: First version, 2002
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    References listed on IDEAS

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    4. John L. Park & Rodney B. Holcomb & Kellie Curry Raper & Oral Capps, 1996. "A Demand Systems Analysis of Food Commodities by U.S. Households Segmented by Income," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 290-300.
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    Citations

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    Cited by:

    1. Jaya Krishnakumar & A. Nagar, 2008. "On Exact Statistical Properties of Multidimensional Indices Based on Principal Components, Factor Analysis, MIMIC and Structural Equation Models," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 86(3), pages 481-496, May.
    2. Mehmet Pinar & Thanasis Stengos & Nikolas Topaloglou, 2013. "Measuring human development: a stochastic dominance approach," Journal of Economic Growth, Springer, vol. 18(1), pages 69-108, March.
    3. Elizabeth Stanton, 2007. "The Human Development Index: A History," Working Papers wp127, Political Economy Research Institute, University of Massachusetts at Amherst.
    4. Jaya Krishnakumar, 2007. "Going Beyond Functionings to Capabilities: An Econometric Model to Explain and Estimate Capabilities," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 8(1), pages 39-63.
    5. Amal Ray, 2008. "Measurement of social development: an international comparison," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 86(1), pages 1-46, March.
    6. Tatiana Tikhomirova & Ani Sukiasyan, 2014. "Modified Estimates Of Human Potential In The Regions Of Russian Federation Taking Into Consideration The Risks Of Health Losses And Social Tensions," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(4), pages 164-177.

    More about this item

    Keywords

    North-South; growth model;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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