Human Development vs Economic Development
Economic development and human development are concepts that are related to one another in that they both measure a country’s overall development in terms of economic wealth and human welfare. While human development is very much focused on the wellbeing of people, economic development covers a wide spectrum of social and economic factors. The article offers a clear overview of each and highlights the similarities, differences and relationship between the human development and economic development.
What is Human Development?
Human development is the process in which an individual’s freedom, opportunities, and wellbeing are continuously improved. Economist Mahbub ul Haq developed the concept of human development in the 1970s on the premise that gross domestic product or GDP (largely a measure of economic growth) failed to give justice to the measurement of human development. The concept of human development believes that people should have good health, access to education, and a decent standard of living. Human development is measured by the Human Development Index (HDI). The HDI measures the education levels, health and standard of living. The HDI measures health by taking into consideration life expectancy at infant birth, education by literacy rates and school enrollment and standard of living by the per capita GDP. Other measures of human development include the Human Poverty Index (HPI) and Gender Empowerment Measure (GEM). The GEM measures the inequality between men and women by taking into consideration the proportion of women that hold leadership roles in politics, business and their work careers. The GEM also looks at women’s contribution to the national income and the percentage of women in the workforce. The HPI measures the percentage of the population that does not have access to basic necessities.
What is Economic Development?
Economic development refers to the improvement of the overall economic wealth of a country. Economic development includes the development of human capital, improving standards of living, development of buildings and infrastructure, economic growth (as measured by GDP), increase in international trade, environmental health, improving health, public safety, social justice, life expectancy, literacy, etc. Economic development is aimed at improving the economic and social wellbeing of the country and its people. According to the findings of Professor Michael Todaro, the best way to measure economic development is through the Human Development Index (HDI). He argues that HDI takes into consideration the literacy rates of the country as well as life expectancy, which can have a huge impact on productivity.
What is the difference between Economic Development and Human Development?
Economic development and human development are both measures that are used to determine the overall development in a country or region. Measures of economic development are very broad and include a wide spectrum of elements such as economic growth (measured by GDP), standards of living, infrastructure, international trade, environmental health, public safety, social justice, life expectancy, literacy, health, etc. Human development is a component that makes up economic development. A country’s GDP does not take into consideration people’s health, education or standard of living. Hence measures such as HDI, GEM, and HPI were developed to measure human development in terms of health, education, standard of living, income, poverty, gender equality, etc. Human development can lead to economic development, as when more people have better education, health and standard of living that will increase the levels of productivity, investment and economic growth which can eventually result in economic development.
Summary:
Economic Development vs Human Development
• Economic development and human development are concepts that are related to one another in that they both measure a country’s overall development in terms of economic wealth and human welfare.
• Economic development refers to the improvement of the overall economic wealth of a country.
• Measures of economic development are very broad and include a wide spectrum of elements such as economic growth (measured by GDP), standards of living, infrastructure, international trade, environmental health, public safety, social justice, life expectancy, literacy, health, etc.
• Human development is the process in which an individual’s freedom, opportunities and wellbeing are continuously improved.
• Human development is measured by the Human Development Index (HDI). The HDI measures the education levels, health and standard of living.
• Other measures of human development include the Human Poverty Index (HPI) and Gender Empowerment Measure (GEM).
• Human development can lead to economic development, as more people having better education, health, and standard of living increase the levels of productivity, investment and economic growth which can eventually result in economic development.