Human Development Index

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According to the Human Development Index (HDI), average lifespan, education (mean years of education completed and expected years of schooling upon entering the school system), and per capita income indicators are combined to create a composite index that is used to classify countries into four tiers of human development. An increase in HDI is achieved when a country's lifetime is increased, its education level is increased, and its gross national income (PPP) per capita is increased. A Pakistani economist, Mahbub ul Haq, created the indicator, which was later adopted by the United Nations Development Programme (UNDPHuman )'s Development Report Office for use in assessing a country's progress toward development.

According to the 2010 Human Development Report, an Inequality-adjusted Human Development Index was established (IHDI). It was stated that, while the simple HDI is still useful, it should be understood that "the IHDI is the actual level of human development (accounting for inequality), while the HDI can be viewed as an indicator of "potential" human development (or the maximum level of HDI that could be achieved if there was no inequality).

Several variables, such as net national wealth per capita or the relative quality of products produced in a country, are not taken into consideration by the index. As a result of this scenario, several of the most advanced nations, such as the G7 members and others, have seen their rankings fall.