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Assess Different Indicators Used to Measure Development Essay

Development is a process of change that affects people’s lives, which may involve an improvement in the quality of life as perceived by the people undergoing change. As development is such a wide category, it can be split into social and economic factors as well as simple and composite indicators. To start with, many economic indicators are used to measure a country’s development. GDP (Gross Domestic Product), this is the total value of goods and services produced in a country. GNP (Gross National Product) includes income from investments abroad and PPP (Purchasing Power Parity) takes into account local cost of living and is usually expressed per capita. These are the three main economic indicators.

Many advantages appear when using economic measurement as an indicator, such as it is a useful figure for comparing countries and often used to rank countries to establish a fair system of aid payments. Also, each country can be easily compared and calculated so that patterns can be seen quickly. However, this way of measurement does come with a lot of problems. For example, the distribution of wealth is unequal I most/all countries but when studying the indicator results, it shows that supposedly the country has an equal distribution. This results in inequality being ‘covered up’ and a true picture is not shown which therefore makes the result lack in validity. Countries have different currencies, which is an issue within itself but this is enlarged when countries have different currency fluctuations.

This makes it hard to then compare each countries results to one another as the values shown have different rates of wealth. Although, this problem is being tackled by converting all the currencies to US$ so easy comparisons can be made, and patterns can be easily shown when comparing countries. Other problems that come from using economic indicators are they can be manipulated by governments who want to appear poor to collect more aid and it does not take into account informal economies which are very important in less developed countries.

To try and eliminate the economic problems, social indicators are also used to make the results as accurate as possible. Social indicators are used mainly to give an idea about the peoples quality of life in that country, although this can be significantly hard to actually categorise. The main indicators for the social categories are Life Expectancy (the average lifespan of someone born in that country), Birth Rate (number of babies born per thousand people per year). This allows a clear indicator of a countries level of development, as well as being able to predict the future situation to plan accordingly. BR can be affected by population policies (e.g. China’s one child policy) and figures in LEDCs are not necessarily accurate.

Literacy Rate (percentage of the population able to read and write) also has negatives such as when used on its own it doesn’t tell us whether the figure is a consequence of too few schools or the fact that children are having to work. The other issue is that it takes no notice of other skills (agricultural for example) the people may have which are equally valuable (e.g. a good understanding of farming techniques). Literacy rates is used as an indicator because it does show the amount of education on offer and tells us how many children could or couldn’t attend school. Finally, Infant Mortality (the number of children who die before they reach the age of one for every thousand live births per year).

An advantage of using these four social indicators to ‘measure’ a country as a general point is that more patterns are shown by comparing economic and social factors. For example, the higher the GDP per person the higher the life expectancy showing a positive correlation between the two.

As stated in the opening paragraph, the development of a country can also be measured by using simple and composite indicators. The indicators discussed above in both economic and social categories are classed as simple indicators (excluding GDP). The composite indicator definition is as follows: ‘Composite indicators measures are used when single indicators cannot adequately capture such multi-dimensional concepts. Ideally, a composite indicator should be based on a theoretical framework / definition, which allows individual indicators/variables to be selected, combined and weighted in a manner which reflects the dimensions or structure of the phenomena being measured’.

Simplified, composite indicators combine a number of single component indices to give a combined score. A frequent composite indicator that is often used is the HDI (Human Development Index). this combines PPP, life expectancy, adult literacy and average number of years in schooling. Other composite indicators include GEM (Gender Empowerment Measure) and GDI (Gender-related Development Index) to measure gender inequality.

Other quality of life indicators could measure a variety of social and economic fac tors. Composite indicators are often considered more reliable as they combine a number of simple indicators to give one average score. The problem with this however is having only an average result. As previously discussed, by having an average score the result lacks validity as it doesn’t show a true picture.

In conclusion, the method that gives the most accurate and true representation of a country, in my opinion, is to use a combination of social and economic simple indicators. Many positives and negatives come from using simple and composite indicators, but the key problem with using composite is that it only gives an average. The main point of creating and using indicators is to get the true representation of a countries development, and composite indicators often do no prove this where as simple indicators are more likely to.

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