ECS3707
ASSIGNMENT 2 SEMESTER 2 2024
UNIQUE NO. 895997
DUE DATE: 17 SEPTEMBER 2024
, ECS3707
Assignment 3 Semester 2 2024
Unique Number: 895997
Due Date: 17 September 2024
Development Economics
Question 1: Critically Assessing Economic Metrics for Development Progress
1.1
Gross Domestic Product (GDP) per capita:
Components and Methodology - GDP per capita is calculated by dividing the
total Gross Domestic Product of a country by its population. It represents the
average economic output or income per person.
Aspects Captured - GDP per capita focuses on economic performance,
measuring the total value of goods and services produced within a country. It
serves as a proxy for standard of living, with higher GDP per capita often
associated with higher material wealth.
Limitations - It does not account for income distribution, environmental
sustainability, or social welfare, neglecting aspects such as education, health,
and inequality.
Human Development Index (HDI):
Components and Methodology - HDI, developed by the United Nations
Development Programme (UNDP), combines three dimensions: (1) Life
expectancy (health), (2) Education (measured by mean years of schooling and
expected years of schooling), and (3) Standard of living (measured by Gross
National Income per capita).
, Aspects Captured - HDI aims to provide a multidimensional view of
development by focusing on human well-being rather than economic growth
alone. It reflects broader aspects like education, health, and income.
Limitations - While HDI incorporates multiple dimensions, it still simplifies
complex human experiences into a single composite index and may overlook
inequality within a population.
Multidimensional Poverty Index (MPI):
Components and Methodology: MPI assesses poverty through ten indicators
spread across three dimensions: (1) Health (child mortality, nutrition), (2)
Education (years of schooling, school attendance), and (3) Living standards
(access to electricity, clean drinking water, sanitation, cooking fuel, and housing).
Aspects Captured: MPI captures the intensity of poverty by identifying the
deprivations that people face in various dimensions, providing a more detailed
understanding of multidimensional poverty beyond income alone.
Limitations: MPI may be limited by data availability and may not fully capture
all non-monetary dimensions of well-being, such as political freedom and
psychological well-being.
Comparison:
GDP per capita focuses primarily on economic performance, whereas HDI and
MPI aim to assess broader dimensions of human development. HDI
combines health, education, and income to give a holistic view of well-being,
while MPI highlights multiple deprivations in poverty.
HDI and MPI are multidimensional, capturing aspects like life expectancy and
quality of life, which GDP per capita does not address. However, both HDI and
MPI have their own methodological limitations in reducing complex realities to
a single index.
