Has Human Development Stagnated?

 

The 2025 UN Human Development Report notes that the Human Development Index (HDI) has been stagnating for most countries in the World-System. A forecast from the WL20 Model (above) makes the same prediction with narrow 98% Prediction Intervals. This post presents my own version of the HDI index and suggests that a Steady State may not be the best forecast for the future.

The Human Development Index is likely to be driven, in the future, by the World System which is currently in Growth-and-Collapse model.

Stagnation-and-collapse will not be a believable forecasts for optimistic commentators, but it is hard to see how Human Development will stabilize if the World System is in collapse mode. 

First, let me discuss how my version of the HDI (WL20_HDI) was constructed. I felt it was necessary to recreate the index and address criticism of the UN's methodology. One general criticism is that the HDI has not be located globally within the World-System (I do that in this post). From Wikipedia (here):

There have also been various criticism towards the lack of consideration regarding sustainability (later addressed by the planetary pressures-adjusted HDI), social inequality (addressed by the inequality-adjusted HDI), unemployment or democracy).

The removal of literacy from HDI has been criticized because educational attainment evaluates only the quantity of education but not the quality or the outcomes of education and can result in perverse incentives.

The indicators I have chosen to reconstruct the index (see Codes below) address some of these criticisms. From a comparison of WL20_HDI to the UN HDI (see below) both indexes show similar time paths over the Long Twentieth Century, although the UNDP does not not fit a model that can account for the approaching Steady State.

So, yes the HDI has stagnated or reached a steady state. On the other hand, the best model for the HDI is a Random Walk which suggests that future predictions are not certain and collapse is possible.

COMMENT: The intent of the UN HDI was to switch the focus from GDP, as a measure of progress, to "Human" measures of progress. From the standpoint of Systems Theory, however, neither is adequate without a measure of System State. And, what is interesting about the WL20_HD, currently, is that the State of the WL20 Model is not the best predictor. 

Notes

From Wikipedia:

The Human Development Index (HDI) is a statistical composite index of life expectancy, education (mean years of schooling completed and expected years of schooling upon entering the education system), and per capita income indicators, which is used to rank countries into four tiers of human development. 

 

Country Distribution of the HDI Index

The highest level of HDI is in Norway while the lowest is in Niger.  The World System is right in the middle while the US is in the top of the distribution (but has been loosing ground over the Long Twentieth Century). Notice that the UN HDI index is highly correlated with my HDI index and also appears to be reaching a steady state.

WL20 HDI Measurement Model

Two components of my constructed HDI index (constructed with Principal Components)  explain 99.8% of the variation in the indicators. HDI1 is a measure of overall growth in the indicators. HD2 is an historical controller balancing Life Expectancy against growth in the other indicators.

The WL20 HDI Index is largely unidimensional with the second component (HD2) acting as an historical controller before 1980 but not afterward (time plot above).

WL20 HDI Codes

The definition of codes in my WL20 HDI index is presented above.

WL20 HDI BAU Model

The WL20_HDI BAU model is stable and, from the graphic at the beginning of the article, reaches a steady state around 2100. The growth rate for my HDI index has been slowing since after 2000.

WL20 HDI Model AIC Statistics

From the Akaike Information Criterion (AIC) alone, the WL20_HDI Index is best seen as a Random Walk, meaning that in the future, anything can happen.

Since the Growth Component (W1) of the WL20 Model is expected to peak before 2050, the World System is predicted to be in growth-and-collapse mode.  Even though the  World System is not the best predictor of the HDI Index, that could change in the future.

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