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The Advantages and Disadvantages of Contrasting Ways of Measuring Development
Development, the process of positive change occurring over time, can be interpreted as purely economic, purely based on environmental and social factors, or, perhaps most appropriately, as a combination. Hence, there are various categories of development indicators, but the relative importance of each is somewhat subjective.
The multivariate analysis, pioneered by Berry in the 1970s, includes a long list of measures, from basic economic indicators, namely gross domestic product per capita, and infrastructure measures, e.g. kilometres of railway per square kilometre. Whilst these factors are predominantly quantitative, and so the value of each individual measure is objective, the weighting given to each one is highly subjective, and the analysis fails to clearly distinguish between higher ranking countries. Some of the indicators may be misleading when labelled as "development"; railway per square kilometre, for instance, may rank some areas of sub-saharan countries highly, despite much of the railway denoting a poverty- and colonial invasion-ridden past, whilst some countries have high development, but rely on other forms of transport due to environmental determinism.
Purely social indicators, such as censorship and happiness, are qualitative, and so they are subjective. Some countries may have a low quality of life, but high perceived happiness. For example, Sri Lanka ranks highly on the Physical Quality of Life Index (PQLI), despite its relatively low gross domestic product. Historically, some Middle-Eastern countries have PQLI scores in the low 30s, in contrast with Sri Lanka's score of 82 out of 100.
Conversely, purely economic indicators, including gross domestic product and value of exports, are biased towards market-based economies; the Middle East ranks highly on economic development indicators, due to its abundance of oil, but this fails to take into account the levels of gender inequality and repression, which cause countries like Saudi Arabia to fall in social indicators.
Perhaps the most efficient indicators are those that use a mixture of social and economic indicators, and result in a finite value, allowing countries to be ranked. Although this system may give no credit for absolute performance of leading or trailing countries, it does provide a simplistic view of the relative development of nations. Such indicators include the Human Development Index (HDI), which is able to give the Middle East some credit for its economic development, but allows countries with with a high social awareness, such as those in Scandinavia, along with New Zealand, to prevail.