Key Concepts
- 1Why is per capita income alone not a sufficient indicator of development?
Important Formulas & Facts
Per capita income is insufficient because: (1) Averages hide inequality — a rich and poor country can have same average. (2) Ignores non-material aspects — health, education, freedom, dignity. (3) Doesn't measure distribution — who benefits? (4) Ignores sustainability — resource depletion not counted. (5) Ignores public facilities — clean water, sanitation, healthcare. That's why HDI (Human Development Index) is better — combines: (1) Per capita income. (2) Life expectancy. (3) Mean years of schooling. India ranks 132/191 in HDI 2023 despite being 5th largest economy.
Must-Know Questions
Q1What is the Human Development Index (HDI)? Which body publishes it?
HDI is a composite index measuring human development based on three parameters: (1) Health — Life expectancy at birth. (2) Education — Mean years of schooling + expected years of schooling. (3) Standard of living — per capita income (GNI per capita at PPP). HDI is published annually by UNDP (United Nations Development Programme). India ranks around 132 out of 191 countries. Top: Norway, Switzerland. Bottom: South Sudan, Chad.
Q2What is the difference between development and economic growth?
Economic growth: Increase in GDP/national income over time — purely quantitative measure of production. Development: Broader concept — includes economic growth PLUS improvement in quality of life — education, health, environment, freedom, equity. A country can have high GDP growth but poor development if benefits don't reach all people (e.g., rising GDP with persistent poverty, pollution, or inequality). HDI measures development, GDP measures growth.
Q3What criteria is used by the World Bank to classify countries?
The World Bank classifies countries based on per capita income (GNI per capita). Rich/developed countries: per capita income > US $12,056 (high-income). Low-income countries: per capita income < US $1,025. India is classified as a lower-middle-income country.
Q4Why do different people have different development goals?
Different people have different development goals because: (1) Their life situations differ — a farmer wants irrigation, a student wants education. (2) What may be development for one may not be for another — a dam provides electricity but displaces people. (3) Income level matters — a rich person wants luxury, a poor person wants basic needs. (4) People seek a mix of goals: income, security, respect, freedom, equality.
Q5What is sustainable development?
Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their needs. It balances: (1) Economic growth. (2) Environmental protection. (3) Social equity. Examples: using renewable energy, organic farming, rainwater harvesting, forest conservation.
Practice Development
Reinforce what you just revised with practice questions