Computation of the HDI

Operationally, any progress or change in human development is measured by an index called the “Human Development Index” or HDI. This index attempts to measure the complex concept of human development by tracking the progress of three selected aspects of human life mentioned above. As an index that tries to capture and simplify description of human development, it can evolve through time depending on the availability of data and emerging needs.

In the Philippines, the HDI is measured by taking the average of (1) life expectancy; (2) weighted average of functional literacy and combined elementary and secondary net enrolment rate; and (3) real per capita income. That is,

HDI = (I₁ + I₂ + I₃ ) / 3

where

a) I₁ = life expectancy index

I₁ = ( H – H_min ) / (H_max – H_min)

where

H = life expectancy at birth (in years) by province
H_max = 85 years
H_min = 25 years

Note: The minimum and maximum values adopted for life expectancy at birth are based on the values being used by UNDP and HDN.

b) I₂ = education index

I₂ = 2/3 (E₁) + 1/3 (E₂)

where

E₁ = (Lit – Lit_min) / (Lit_max– Lit_min) = index for functional literacy by province
Lit_max= 100
Lit_min = 0

E₂ = (Enrol – Enrol_min) / (Enrol_max– Enrol_min) = index for combined elementary and secondary net enrolment rate by province
Enrol_max = 100
Enrol_min = 0

c) I₃ = income index

I₃ = (Y – Y_min) / (Y_max - Y_min )

where

Y = real per capita income by province

for 1994, Y_max = Php37,070
Y_min = Php 6,533

for 1997, Y_max = Php48,930
Y_min = Php 8,181

for 2000, Y_max = Php44,357
Y_min = Php 5,960

Note: The maximum and minimum values set for the income indicator are the highest and lowest values of real income per capita actually attained by the provinces for a particular reference year. As suggested by the Human Development Network (HDN), the National Capital Region was treated as one of the provinces in determining the maxima and minima. Hence, the NCR real income figures were adopted as the maximum values in the computation of the HDI for all provinces for the three reference years.