What are social and economic indicators of development?

Development is an increase in the standard of living of the people in a country.

Both social and economic indicators can be used to:

• determine how developed a country is
• identify the main similarities and differences between them

Economic indicators include:

• Gross Domestic Product
• Gross Domestic Product per person
• % of people employed in agriculture

Social indicators include:

• life expectancy
• adult literacy rate
• number of doctors per 1,000 people

Watch this video to revise economic and social indicators and how we can use them together to get a full picture of a country's development.

Development is any improvement in the standard of living of people in a specific country.

The level of a country's development is reflected in two different sets of factors:

• factors related to money, such as wealth, which we call economic factors
• factors related to people, such as literacy, which we call social factors.

A developed country is one that is considered to have a higher standard of living. This could be reflected by indicators such as:

• higher income
• good education system
• longer life expectancy

A developing country is one that is considered to have a lower standard of living. This could be reflected by indicators such as:

• lack of medical care
• limited access to education
• more people working in agriculture

Development is a measure of different types of progress within a country:

• economic
• social
• technological

Both social and economic indicators can be used to determine if a country is developed or developing.

It also helps identify the main similarities and differences between them.

In this video, civil engineer, Hiba, explains different indicators of development including the Human Development Index (HDI).

These measure the economic output or wealth of a country. They include:

• Gross Domestic Product (GDP) per person, which is the value of goods produced within a country's borders, divided by the total population.

  • This gives an average income for each citizen.
  • It can indicate how much money a government has to spend on services like health and education, or infrastructure like electricity and sanitation.

• percentage of people employed in agriculture

  • People employed in agriculture are likely to be less skilled and have lower pay.
  • This will affect how much they can contribute to their own standard of living.
  • It will affect how much income tax a country takes in to pay for public services.

There are problems with looking at only one indicator, such as GDP per person. For example:

• This is an average and so may be easily skewed by a few very wealthy families. This could mask extreme poverty for the majority of the population.
• It does not take into account the cost of goods, which affects what people can buy with their wages.
• How wealthy a country is does not take into account how this money is used. It does not show data on how well-educated people are or how good their diet is.
• It does not take into account differences between urban and rural areas, eg
  • In 2025, Washington, D.C. has the highest GDP (Gross Domestic Product) per person in the USA at $278,000.
  • Mississippi State, which is mostly rural, had the lowest GDP per person of any state at $56,000.

Social indicators of development are used to:

• measure social issues
• indicate how good the quality of life is in a particular country

This table summarises some of the key social indicators.

As with using only economic indicators, similar problems occur when trying to evaluate the development of a country using only social indicators.

• Social indicators are also averages across a country, so they hide regional differences and do not compare health with education and diet.
• It is better to examine both social and economic indicators if you want to get a true picture of development in a country.

The Human Development Index (HDI) has been used by the UN since 1990, and measures:

• longevity (life expectancy at birth)
• education (expected years of schooling for children starting school / mean years of schooling for adults over 25 years old)
• income (Gross National Income (GNI) per capita / linked to purchasing power)

These combine to give a score from 1 (highest) to 0 (lowest). Countries are classed into four groups:

• very high: 0.8 or above, eg the UK, USA, Australia and Denmark are all over 0.9
• high: 0.700 - 0.799, eg China, Peru and Indonesia
• medium: 0.550 - 0.699, eg India, Nigeria and Cambodia
• low: under 0.550, eg Pakistan, Malawi, Chad

(UN Development Programme, 2023)

HDI gives a more accurate picture of a country’s situation than GNI per capita alone.

Compare the two tables below showing HDI for Croatia and Qatar in 2023.

• Based on GNI per capita, or life expectancy alone, Qatar would be seen as more highly developed.
• Based on years of schooling alone, Croatia would be seen as more highly developed.
• Combining all these indicators results in both countries having a similar HDI value, suggesting similar levels of development.

Development is an increase in the standard of living of the people in a country.

It includes:

• economic factors
• social factors

Both social and economic indicators can be used to:

• determine how developed a country is
• identify the main similarities and differences between them

Economic indicators include:

• Gross Domestic Product: the value of goods and services produced by a country over a certain period (eg one year)
• Gross Domestic Product per person: the value of goods and services produced by a country divided by the total population. This gives an average income for each citizen and makes it easier to compare countries with different sizes of population.
• Percentage of people employed in agriculture: indicates lower pay and lower income tax taken by a country.

Social indicators include:

• Number of people per doctor: indicates access to healthcare
• Percentage of adults who are literate: indicates access to education and learning
• Number of years of school attendance: indicates access to education and can reflect areas like child labour.
• Number of calories consumed per person per day: reflects diet and can be an indicator of health
• Life expectancy: the average age people are expected to live to indicates their health and reflects healthcare and social care
• Infant mortality: number of children per 1,000 born who die before the age of one, reflects healthcare
• Population change : number of babies born per 1,000 women per year can reflect many areas including health education, access to birth control, female education and employment.

Economicandsocialindicators should be used together to give a more accurate picture of development.

Human Development Index (HDI) is a combined indicator used by the UN to give a better overall picture of development.