Estonian Human Development Report
Estonian Human Development Report - Eesti Koostöö Kogu
Estonian Human Development Report - Eesti Koostöö Kogu
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CHAPTER 1<br />
<strong>Estonian</strong> <strong>Human</strong> <strong>Development</strong><br />
Index and its components<br />
1.1. Global <strong>Human</strong> <strong>Development</strong> Index<br />
The measurement of human development<br />
and the paradoxes related thereto<br />
Today’s rational person is characterized by a desire to quantitatively<br />
measure all kinds of phenomena with the goal of<br />
assessing and comparing them, and also managing and<br />
directing them to change in the desired direction. For this,<br />
however, one must be sure about the direction one wants to<br />
move in. When measuring the development of society, it is<br />
necessary to understand what determines the developmental<br />
level a society or country has achieved. How important<br />
are wealth and the abundance of opportunities? In determining<br />
a country’s developmental level, what role is played<br />
by the population’s perception of the surrounding world<br />
– against the background of a scientific or religious worldview?<br />
Is the sustainability of the population and culture a<br />
precondition for a high developmental level in a country/<br />
society, or is it a consequence? To what extent, are the developmental<br />
level of a society and the quality of life and happiness<br />
of its people related? Is there reason to believe that the<br />
highest possible quality of life of its societal members is the<br />
objective we should to aspire to?<br />
With regards to countries, it has been the custom for<br />
a long time to speak about their developmental level, but<br />
the quantitative scale for measuring developmental levels<br />
is a relatively new phenomenon. Since 1990, the UN has<br />
issued an annual <strong>Human</strong> <strong>Development</strong> <strong>Report</strong>. It has also<br />
Figure 1.1.1. The <strong>Human</strong> <strong>Development</strong> Index (horizontal<br />
line) and its components (Estonia, 2008)<br />
1<br />
0.9<br />
0.8<br />
0.7<br />
0.6<br />
0.5<br />
0.4<br />
0.3<br />
0.2<br />
0.1<br />
0<br />
Life expectancy index Education index Standard of living index<br />
Source: HDR 2008<br />
included a <strong>Human</strong> <strong>Development</strong> Index (HDI) calculated<br />
for each UN member state and a country ranking based on<br />
the index. According to this concept, the <strong>Human</strong> <strong>Development</strong><br />
Index should measure the opportunities available to<br />
the population of each country, based on the assumption<br />
that an abundance of opportunities is related to a higher<br />
quality of life for the people living in that country.<br />
Every numerical composite indicator is associated with<br />
a statistical paradox: the occurrence of development should<br />
be demonstrated by an increase in the average level, while,<br />
in the case of many indicators, a higher average often results<br />
in greater inequality, indicating the disparity of the society’s<br />
development. Since this disparity results from the processes<br />
actually taking place and the particularities of individual<br />
phenomena and various speeds of development, the<br />
reduction of the inequality of various indicators requires<br />
the implementation of additional resources. Therefore the<br />
higher a country’s average developmental indicator, the<br />
more resources are required to reduce the inequality. Thus<br />
it follows that the guarantee of an abundance of opportunities<br />
is one of the primary assignments of the state for the<br />
support of positively progressing developmental processes.<br />
The calculation of the <strong>Human</strong> <strong>Development</strong> Index is<br />
based on three relatively easy-to-find indicators that characterize<br />
the country’s social and economic situation. These<br />
indicators are:<br />
• Life expectancy at birth, which indicates a population’s<br />
health and longevity;<br />
• Educational attainment, which is indicated, on the one<br />
hand, by adult literacy, and on the other hand, by the<br />
enrolment rate of students at various educational levels;<br />
• Standard of living, which is measured by GDP per capita<br />
at purchasing power parity in US dollars.<br />
A component (index) is calculated on the basis of each<br />
indicator, which is assigned a value between 0 and 1. The<br />
higher the value of the corresponding component, the<br />
higher the level of the corresponding life sphere in the<br />
country is. The HDI is calculated as the average of the<br />
three components (Figure 1.1.1.).<br />
Even though one may be somewhat sceptical about the<br />
<strong>Human</strong> <strong>Development</strong> Index as a whole, because the combination<br />
of its components is not substantively well justified, it<br />
has still turned out to be useful as a comparative assessment<br />
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