On Some Problems of Using the Human Development Index in Economic History

57 Pages Posted: 16 Nov 2021 Last revised: 18 Nov 2021

See all articles by Nicola Amendola

Nicola Amendola

University of Rome Tor Vergata - Department of Economics and Finance

Giacomo Gabbuti

St. Antony's College, University of Oxford

Giovanni Vecchi

University of Rome Tor Vergata - Faculty of Economics

Date Written: November 9, 2021

Abstract

We argue against the use of composite indices, such as the Human Development Index (HDI), in economic history. We show that the HDI can be interpreted as a formal representation of the analyst’s ethical system. We support our claim by introducing a new class of paternalistic social welfare functions (Graaff 1957, Mas-Colell, 1995) which encompasses all the HDI formulas put forth by the literature. The theoretical framework is illustrated by an empirical investigation of the long-run evolution of Italians’ living standards and civic liberties. We conclude that any history based on composite indices is one where both data and history play a minor role, if any.

Keywords: human development index; economic wellbeing; composite indices; living standards; CES; social welfare functions; Italy

JEL Classification: N01, N3, O15

Suggested Citation

Amendola, Nicola and Gabbuti, Giacomo and Vecchi, Giovanni, On Some Problems of Using the Human Development Index in Economic History (November 9, 2021). CEIS Working Paper No. 527, 2021, Available at SSRN: https://ssrn.com/abstract=3960119 or http://dx.doi.org/10.2139/ssrn.3960119

Nicola Amendola

University of Rome Tor Vergata - Department of Economics and Finance ( email )

Rome
Italy

Giacomo Gabbuti

St. Antony's College, University of Oxford ( email )

62 Woodstock Rd
Oxford, OX2 6JF
United Kingdom

Giovanni Vecchi (Contact Author)

University of Rome Tor Vergata - Faculty of Economics ( email )

Via Columbia n.2
Rome, rome 00100
Italy
+39 6 7259 5730 (Phone)
+39 6 2020 500 (Fax)

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