What is the effect of fixing the maximum of GNI per capita at $75,000?
Income is instrumental to human development, but the contribution diminishes as incomes rise. Also, a high income without being translated into other human development outcomes is of less relevance for human development. Fixing the maximum at $75,000 means that for countries with GNI per capita greater than $75,000, only the first $75,000 contributes to human development. In this way the higher income is prevented from dominating the HDI value. Currently we have only 5 countries with GNI pc above the cap – Brunei Darussalam, Liechtenstein, Kuwait, Qatar and Singapore. Projections based on fairly realistic growth rates have shown that by 2020 not more than seven countries will exceed the limit.