Human Development Reports - United Nations Development Programme (UNDP)

Adjusting the Human Development Index for inequality

Reflecting inequality in each dimension of the HDI addresses an objective first stated in the 1990 HDR. This Report introduces the Inequality-adjusted HDI (IHDI), a measure of the level of human development of people in a society that accounts for inequality. Under perfect equality the HDI and the IHDI are equal. When there is inequality in the distribution of health, education and income, the HDI of an average person in a society is less than the aggregate HDI; the lower the IHDI (and the greater the difference between it and the HDI), the greater the inequality. We apply this measure to 139 countries. Some findings:

• The average loss in the HDI due to inequality is about 22 percent—that is, adjusted for inequality, the global HDI of 0.62 in 2010 would fall to 0.49, which represents a drop from the high to the medium HDI category. Losses range from 6 percent (Czech Republic) to 45 percent (Mozambique), with four fifths of countries losing more than 10 percent, and almost two-fifths of countries losing more than 25 percent.
• Countries with less human development tend to have greater inequality in more dimensions—and thus larger losses in human development. People in Namibia lost 44 percent, in Central African Republic 42 percent and in Haiti 41 percent because of multidimensional inequality.
• People in Sub-Saharan Africa suffer the largest HDI losses because of substantial inequality across all three dimensions. In other regions the losses are more directly attributable to inequality in a single dimension— as for health in South Asia (figure 5.2 from the Report).

• Read more
• Read the 2010 Report Chapter 5 - Innovations in measuring inequality and poverty [2,277 KB]

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2011 Report