A Probabilistic Approach to the Inequality Adjustment of the Human Development Index

Abstract

ABSTRACT. The Composition of ProbabilisticPreferences is here applied to combine eight indicators of human development. The four components of HDI are considered together with indices of inequality in longevity, schooling, and income, and the UNDP Gender Development Index. To compose the probabilities of preference by the different criteria, a pessimistic and conservative point of view is taken. This point of view, while generating the global score, results in employing for each option the probability of not presenting the lowest evaluation according to any criterion, increasing the importance assigned in the computations to the proximity to the frontier of worst performances. Alternative rankings of the 188 countries ranked in the 2015 and the 2016 Human Development Report are obtained. Capacities allowing for interactions between up to eight components are employed. Representative profiles of ordered classes are derived from the rankings. Classifications of the countries into previously determined classes are also performed.