Skip to main content

Advertisement

SpringerLink
Log in

Transforming Economic Growth into Inclusive Development: An International Analysis

  • Original Research
  • Published:
Social Indicators Research Aims and scope Submit manuscript

Abstract

This paper conducts a critical analysis on growth and development in world countries. Using different dimensions featured in the development of several synthetic indexes, it analyzes the relationship between wealth and development estimates. It therefore uses the indicator developed by the World Development Forum, the Inclusive Development Index, turned into complementary economic estimators for different scenarios. Its results allow us to identify key factors for robust synthetic indicators and detect the dimensions and variables of development that have a greater impact on the ranking of countries.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Source: Own elaboration

Fig. 2

Source: Own elaboration

Fig. 3

Source: Own elaboration

Similar content being viewed by others

Notes

  1. The Human Development Report (HDR) Series is a “medium for sharing recent research commissioned to inform the global Human Development Report, which is published annually, and further research in the field of human development” (Neumayer 2011). Yearly reports can be found at: http://www.hdr.undp.org/.

  2. Broader information can be found in Ul Haq (1995), the previous work of the author of this Report.

  3. In fact, as Mishra and Nathan (2013) point out, this work is one of the last attempts of an institutional commitment that should lead to a change in the national accounting systems.

  4. This institution developed the so-called the Physical Quality of Life Index (PQLI) in the mid seventies.

  5. For further information, see Mishra and Nathan (2008) or Seth and Villar (2017).

  6. We recalculated the same values for the same indicators and used the arithmetic mean of the normalized values to calculate the IDI for the total of countries (29 + 78) in a single ranking. Table 2 shows the variation between both. The data for the SDI comes from the aforementioned/cited publication.

  7. For example Haiti, Malawi or Togo.

  8. For example Brunei, Kuwait or Luxembourg.

  9. As it is the case of the United States.

  10. 158 for the SDI and 107 for the IDI.

  11. Let us recall that Singapore and Algeria have no estimates.

  12. For example, the selected indicators or including GDP or other indicators closely related to it (such as labor productivity).

References

  • Anand, P., & Sen, A. K. (1994). The Human Development Index: Methodology and measurement. Human Development Report, Occasional Papers Nº 12. New York: UNDP.

    Google Scholar 

  • Anand, S., & Sen, A. K. (2003). Human Development Index: Methodology and measurement. In S. Fukuda-Parr & A. K. Shiva Kumar (Eds.), Readings in human development. New York: Oxford University Press.

    Google Scholar 

  • Bilbao-Ubillos, J. (2013). Another approach to measuring human development: The composite dynamic Human Development Index. Social Indicators Research, 111(2), 473–484.

    Article  Google Scholar 

  • Bluszcz, A. (2015). Classification of the European Union Member states according to the relative level of sustainable development. Quality & Quantity, 50(6), 2591–2605.

    Google Scholar 

  • Cherchye, L., Ooghe, E., & Van Puyenbroeck, T. (2008). Robust human development rankings. The Journal of Economic Inequality, 6(4), 287–321.

    Article  Google Scholar 

  • Chowdhury, S., & Squire, L. (2006). Setting weights for aggregate indices: An application to the commitment to development index and human development index. The Journal of Development Studies, 42(5), 761–771.

    Article  Google Scholar 

  • Costanza, R., Kubiszewski, I., Giovannini, E., Lovins, H., McGlade, J., Pickett, K. E., et al. (2014). Development: Time to leave GDP behind. Nature, 505(7483), 283–285.

    Article  Google Scholar 

  • Daly, H., & Cobb, J. (1989). For the common good. Boston: Beacon Press.

    Google Scholar 

  • Deaton, A. (2003). Health, inequality and economic development. Journal of Economic Literature., 41(1), 113–158.

    Article  Google Scholar 

  • Diener, E., & Suh, E. (1997). Measuring quality of life: Economic, social, and subjective indicators. Social Indicators Research, 40(1–2), 189–216.

    Article  Google Scholar 

  • European Commission. (2009). GDP and beyond—Measuring progress in a changing world. COM/2009/0433 final, Brussels.

  • Fleurbaey, M. (2015). Beyond income and wealth. Review of Income and Wealth, 61(2), 199–219.

    Article  Google Scholar 

  • Foster, J. E., Lopez-Calva, L. F., & Szekely, M. (2005). Measuring the distribution of human development: Methodology and an application to Mexico. Journal of Human Development, 6(1), 5–25.

    Article  Google Scholar 

  • Fukudda-Parr, S., Lawson-Remer, T., & Randolph, S. (2010). An index of economic and social rights fulfillment: Concept and methodology. Journal of Human Rights, 8(3), 195–221.

    Article  Google Scholar 

  • Giambona, F., & Vassallo, E. (2014). Composite indicator of social inclusion for European countries. Social Indicators Research, 116(1), 269–293.

    Article  Google Scholar 

  • Herrero, C., Martínez, R., & Villar, A. (2010). Multidimensional social evaluation: An application to the measurement of human development. Review of Income and Wealth, 56, 483–497.

    Article  Google Scholar 

  • Herrero, C., Martínez, R., & Villar, A. (2012). A newer human development index. Journal of Human Development and Capabilities, 13(2), 247–268.

    Article  Google Scholar 

  • Klugman, J., Rodríguez, F., & Choi, H. J. (2011). The HDI 2010: New controversies, old critiques. The Journal of Economic Inequality, 9(2), 249–288.

    Article  Google Scholar 

  • Kovacevic, M. (2011). Review of HDI critiques and potential improvements. UNDP, Human Development Reports 2010/33.

  • Kubiszewski, I., Costanza, R., Franco, C., Lawn, P., Talberth, J., Jackson, T., et al. (2013). Beyond GDP: Measuring and achieving global genuine progress. Ecological Economics, 93, 57–68.

    Article  Google Scholar 

  • Kuznets, S. (1934). National income 1929–1932. National Bureau of Economic Research—NBER, Bulletin 49, New York.

  • Lawn, P. A. (2003). A theoretical foundation to support the Index of Sustainable Economic Welfare (ISEW), Genuine Progress Indicator (GPI), and other related indexes. Ecological Economics, 44(1), 105–118.

    Article  Google Scholar 

  • Martinez, E. (2013). Social and economic wellbeing in Europe and the Mediterranean Basin: Building an enlarged human development indicator. Social Indicator Research, 111, 527–547.

    Article  Google Scholar 

  • McGranahan, D., Donald, V., & Pizarro, E. (1985). Measurement and analysis of socio-economic development. Geneva: UNRISD.

    Google Scholar 

  • Mishra, S., & Nathan, H. S. K. (2008). On a class of Human Development Index measures, Working Paper No. WP-2008-020, IGIDR, Mumbai.

  • Mishan, E. J. (1969). Growth: The Price We Pay. London: Staples Press.

    Google Scholar 

  • Mishra, S., & Nathan, H. S. K. (2013). Measuring Human Development Index: The old, the new and the elegant. WP-2013-020, IGIDR, Mumbai.

  • Morris, M. D. (1979). Measuring the condition of the World’s poor: The Physical Quality of Life Index. New York: Pergamon.

    Google Scholar 

  • Morris, M. D. (1980). The Physical Quality of Life Index (PQLI). Development Digest, 18(1), 95–109.

    Google Scholar 

  • Nathan, H. S. K., & Mishra, S. (2010). Progress in human development: Are we on the right path? International Journal of Economic Policy in Emerging Economies, 3(3), 199–221.

    Article  Google Scholar 

  • Neumayer, E. (2011). Sustainability and inequality in human development. UNDP-HDRO Occasional Papers No. 2011/4.

  • OECD. (2008). Handbook on constructing composite indicators. Paris: OECD-JCR European Commission.

    Google Scholar 

  • OECD. (2010). Measuring and fostering the progress of societies. C/MIN(2010)13.

  • Osberg, L. (1985). The measurement of economic well-being. Toronto: University of Toronto Press.

    Google Scholar 

  • Osberg, L., & Sharpe, A. (2011). Moving from a GDP-based to a well-being based metric of economic performance and social progress: Results from the index of economic well-being for OECD countries, 1980–2009. CSLS Research Reports No. 2011-12, Centre for the Study of Living Standards.

  • Peiró-Palomino, J., & Picazo-Tadeo, A. J. (2018). OECD: One or many? Ranking countries with a composite well-being indicator. Social Indicators Research, 139(3), 847–869.

    Article  Google Scholar 

  • Prada, A., & Sanchez-Fernandez, P. (2017). Empirical analysis of the transformation of economic growth into social development at an international level. Social Indicators Research, 130, 983–1003.

    Article  Google Scholar 

  • Prados, L. (2015). World human development: 1870–2007. Review of Income and Wealth, 61(2), 220–247.

    Article  Google Scholar 

  • Ravallion, M. (2012). Troubling trade-offs in the human development index. Journal of Development Economics, 99(2), 201–209.

    Article  Google Scholar 

  • Rende, S., & Donduran, M. (2013). Neighborhoods in development: human development index and self-organizing maps. Social Indicators Research, 110(2), 721–734.

    Article  Google Scholar 

  • Rogge, N., & Van Nijverseel, I. (2018). Quality of life in the European Union: A multidimensional analysis. Social Indicators Research 141(2), 765–789.

    Article  Google Scholar 

  • Sagar, A. D., & Najam, A. (1998). The human development index: A critical review. Ecological Economics, 25, 249–264.

    Article  Google Scholar 

  • Samans, R., Blanke, J., Drzeniek, M., & Corrigan, G. (2017). The Inclusive Growth and Development Report 2017. Geneva: World Economic Forum. http://www3.weforum.org/docs/WEF_Forum_IncGrwth_2017.pdf.

  • Sen, A. (1985). Commodities and capabilities. Amsterdam: North-Holland.

    Google Scholar 

  • Sen, A. (2015). The Country of First Boys: And Other Essays. New Delhi: OUP India.

    Google Scholar 

  • Seth, S., & Villar, A. (2017). Human development, inequality, and poverty: empirical findings. OPHI Working Paper, 111.

  • Skidelsky, E., & Skidelsky, R. (2012). How much is enough? Money and the good life. London: Penguin.

    Google Scholar 

  • Stiglitz, J., Sen, A., & Fitoussi, J. P. (2010). Mismeasuring our lives, Why GDP doesn’t add up. New York: The New Press.

    Google Scholar 

  • Stiglitz, J, Sen. A. K, & Fitoussi, J. P. (2009). The measurement of economic performance and social progress revisited: Reflections and overview. <hal-01069384>, OFCE—Centre de recherche en économie de Sciences Po.

  • Sustainable Development Commission. (2006). Redefining Progress, Report of the SD Panel consultation on Progress. SDC Report, London.

  • Ul Haq, M. (1995). Reflections on human development. Oxford: Oxford University Press.

    Google Scholar 

  • UNDP. (1990). Human development report 1990. New York: United Nations Development Programme.

    Google Scholar 

  • UNDP. (2016). Technical notes—Human Development Reports—UNDP. New York: United Nations Development Programme. http://dev-hdr.pantheonsite.io/sites/default/files/hdr2016_technical_notes_0.pdf.

  • UNRISD. (1972). Contents and measurement of socio-economic development: A staff study. New York: Praeger.

    Google Scholar 

  • Zambrano, E. (2014). An axiomatization of the human development index. Social Choice and Welfare, 42(4), 853–872.

    Article  Google Scholar 

Download references

Acknowledgements

We are very grateful to Santiago Lago-Peñas and two anonymous referees for their insightful comments on a previous version of this paper.

Author information

Authors and Affiliations

  1. Faculty of Economics and Business – University Campus, ECOBAS - University of Vigo, 36200, Vigo, Spain

    Albino Prada

  2. Faculty of Business and Tourism – University Campus, GEN - University of Vigo, 32004, Ourense, Spain

    Patricio Sánchez-Fernández

Authors
  1. Albino Prada
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Patricio Sánchez-Fernández
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Patricio Sánchez-Fernández.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Prada, A., Sánchez-Fernández, P. Transforming Economic Growth into Inclusive Development: An International Analysis. Soc Indic Res 145, 437–457 (2019). https://doi.org/10.1007/s11205-019-02096-x

Download citation

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11205-019-02096-x

Keywords

JEL Classification

Search

Navigation