An Index For Sustainable Development
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A measure of development only in terms of consumption of goods is too narrow. Indeed, development is a wider and more complex concept and both theoretical and empirical analysis should be broadened to include a large set of those aspects which contribute to determine the standard of life of people. An answer to this topic is represented by the Human Development Index which ranks nations according to the aggregation of three socioeconomic indicators, whose choice might seem restrictive, especially when a large set of countries with different paths of development is considered. As a possible improvement of this well-known index some economic, social and environmental indicators have been added in order to derive a comprehensive aggregated index of development. In addition, non-replaceability among the various dimensions of development is assumed, that is only a condition where the different components show the same relative proportions is considered sustainable over time. To this aim a concave Sustainable Socioeconomic Development Index which penalizes progressively the dissimilarity among the components is presented and applied to a large sample of countries. With respect to the hypothesis of perfect substitutability among the different variables, the final ranking of countries is quite different in the case of the Sustainable Socioeconomic Development Index, where penalisations to unbalanced degrees of development have been applied. Keywords: index, development, sustainable development, ranking, HDI. 1 Introduction The measure of development in terms of only consumption of goods is too narrow, as remarkably outlined inter alia by Sen . Indeed development is a wider and more complex concept and empirical analysis should be broadened to include a large set of those aspects which contribute to determine the standard of
index, development, sustainable development, ranking, HDI.