what is hdi in economics

The Human Development Index (HDI) is a statistical tool used to measure a countrys overall achievement in its social and economic dimensions. It is a summary composite measure of a country's average achievements in three basic aspects of human development: health, knowledge, and standard of living. The HDI was created by Pakistani economist Mahbub ul Haq in 1990 and was further used to measure the country's development by the United Nations Development Program (UNDP) . The HDI uses components such as average annual income, educational expectations, and life expectancy to rank and compare countries. The computed HDI of a country is an average of indexes of each of the life aspects that are examined. The HDI sets a minimum and a maximum for each dimension, called "goalposts," then shows where each country stands in relation to these goalposts. This is expressed as a value between 0 and 1, with a higher value indicating a higher level of human development. The HDI is used to capture the attention of policy-makers, the media, and non-governmental organizations, and to change the focus from the usual economic statistics to human outcomes. It was created to emphasize that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth alone.