Comprehensive Notes on Human Development and Growth

Difference Between Growth and Development

• Both growth and development refer to changes over a period of time. However, there is a distinct difference between the two terms.
• Growth is quantitative and value-neutral. This means the change may have either a positive or a negative sign.
• Positive growth indicates a quantitative increase, while negative growth indicates a decrease.
• Development means a qualitative change which is always value-positive.
• Development occurs when there is a positive change in quality.
• Example: If the population of a city grows from $1$ lakh to $2$ lakhs over a period of time, the city has experienced growth. However, if basic facilities like housing, services, and other characteristics remain the same, then this growth has not been accompanied by development.
• For many decades, a country's level of development was measured only in terms of its economic growth. This meant the bigger the economy of the country, the more developed it was considered, even if this growth did not really change much in the lives of the people.

Key Thinkers in Human Development

• The works of two South Asian economists, Dr. Mahbub-ul-Haq and Prof. Amartya Sen, are very important in this regard.
• Dr. Mahbub-ul-Haq: A Pakistani economist who created the Human Development Index (HDI) in $1990$. According to him, development is about enlarging people's choices to lead long and healthy lives with dignity. The UNDP has used his concept of human development since $1990$ to publish the Human Development Report (HDR) annually.
• Prof. Amartya Sen: A Nobel laureate who saw an increase in freedom (or a decrease in unfreedom) as the main objective of development. He argued that increasing freedoms is one of the most effective ways of bringing about development. His work explores the role of social and political institutions and processes in increasing freedom.

Defining a Meaningful Life

• The basic objective of development is to create conditions where people can live meaningful lives.
• A meaningful life is not just a long one; it must be a life with some purpose.
• For a life to be meaningful, people must:
  • Be healthy.
  • Be able to develop their talents.
  • Participate in society.
  • Be free to achieve their goals.
  • Be able to live a decent life.
  • Have access to resources, health, and education.

The Importance of Building Capabilities

• Very often, people do not have the capability to make even basic choices due to several barriers:
  • Inability to acquire knowledge.
  • Material poverty, which leads to an inability to meet basic needs such as food, water, medicine, shelter, and clothing.
  • Social discrimination.
  • Inefficiency of institutions.
• All these factors prevent individuals from leading healthy lives, being educated, or having the means to live a decent life.
• Building people's capabilities in the areas of health, education, and access to resources is therefore crucial for enlarging their choices.
• Lack of capability limits choices. For example, an uneducated child cannot choose to be a doctor because their choice is limited by their lack of education. Similarly, poor people often cannot choose to take medical treatment for a disease because their choice is limited by their lack of resources.

The Four Pillars of Human Development

The concept of human development is supported by four pillars:

• Equity: This refers to making equal opportunities available to everybody irrespective of their gender, race, or income. For example, in India, school dropout rates are higher among women and people from lower castes, showing how their choices are limited by lack of access to knowledge.
• Sustainability: This means continuity in the availability of opportunities. Each generation must have the same opportunities. All environmental, financial, and human resources must be used with the future in mind. For example, if a community does not send girls to school, many career opportunities are lost to these women as adults, affecting their future choices.
• Productivity: This refers to human labor productivity or productivity in terms of human work. Efforts to increase knowledge or provide better health facilities ultimately lead to better work efficiency.
• Empowerment: This means having the power to make decisions. It involves increasing freedom and capability through good governance and people-oriented policies. Empowerment of socially and economically disadvantaged groups is of special importance.

Approaches to Human Development

There are several methods for approaching human development:

• Income Approach: One of the oldest approaches, where human development is directly linked to income levels.
• Welfare Approach: This approach argues for higher government expenditure on education, health, and other amenities, treating people as targets of development activities.
• Basic Needs Approach: Initially proposed by the International Labour Organisation (ILO). It identifies six basic needs: health, education, food, water supply, sanitation, and housing.
• Capability Approach: Associated with Prof. Amartya Sen. It emphasizes that building capabilities in health, education, and access to resources is the key to increasing human development.

Measuring Human Development: HDI and HPI

• Human Development Index (HDI): Measures the quality of life based on a country's performance in health, education, and access to resources. Rankings are based on a score between $0$ and $1$. The closer a score is to $1$, the greater the level of human development. For example, a score of $0.983$ is very high, while $0.268$ indicates a very low level.
  • Life Expectancy at Birth ($LE$): Denotes the average expected length of life. Higher expectancy suggests a greater chance of living a long, healthy life.
  • Literacy Rate ($LR$): Measured for the population aged $15$ and above. It includes academic literacy and enrollment ratios in primary, secondary, and higher education.
  • Access to Resources: Measured as per capita income in terms of purchasing power in US dollars (US \, \) to allow for international comparison.
  • Calculation: Each of the three dimensions (Health, Education, Resources) is given a weightage of $1/3$.
• Human Poverty Index (HPI): Related to the HDI, this index measures the shortfall in human development. It is a non-income measure that takes into account:
  • The probability of not surviving till the age of $40$.
  • The adult illiteracy rate.
  • The number of people without access to clean water.
  • The number of underweight small children.

International Comparisons and Development Levels

• The size of a country and per-capita income are not directly related to human development. Smaller economies can rank higher than larger ones.
• Examples: Sri Lanka, Trinidad, and Tobago have higher HDI ranks than India despite having smaller economies. Within India, Kerala performs better than Punjab and Gujarat despite having a lower per-capita income.
• Countries are classified into four groups based on their HDI scores:
  1. Very High: Scores above $0.800$ ($66$ countries).
  2. High: Scores between $0.701$ and $0.799$ ($49$ countries).
  3. Medium: Scores between $0.550$ and $0.700$ ($44$ countries).
  4. Low: Scores below $0.549$ ($32$ countries).
• Top Ten Ranked Countries (as per provided data):
  1. Norway (Rank $1^{st}$)
  2. Switzerland (Rank $2^{nd}$)
  3. Australia (Rank $3^{rd}$)
  4. Ireland (Rank $4^{th}$)
  5. Iceland (Rank $4^{th}$)
  6. Germany (Rank $5^{th}$)
  7. Denmark (Rank $5^{th}$)
  8. Netherlands (Rank $7^{th}$)
  9. Sweden (Rank $7^{th}$)
  10. Singapore (Rank $9^{th}$)

Characteristics of Development Groups

• High Index Value Countries: These governments invest heavily in education and healthcare. They are often former imperial powers with low social diversity and are heavily industrialised, primarily located in Europe.
• Medium Index Value Countries: Most of these countries emerged after the Second World War as former colonies or after the break-up of the Soviet Union (USSR) in $1990$. They have higher social diversity than the high HDI group and have faced historical political instability or social uprisings. These countries are improving scores by adopting people-oriented policies and reducing discrimination.
• Low Index Value Countries: A large number of these countries are small and experience political instability, civil war, social turmoil, famine, or high incidence of diseases. These nations often spend more on defense than on social sectors and have not been able to initiate accelerated economic development.
• Misconceptions in Comparisons: It is common for people to blame the culture or religion of a country for low levels of human development (e.g., "Country X is lower because its people follow Z religion"). Such statements are misleading. It is more important to look at the patterns of government expenditure on social sectors and the political environment/amount of freedom people have.