New Zealand Subnational Human development index (SHDI)

Most macro economics courses cover development economics and the human development index (HDI). The HDI is the average of three indices based on three different variables and it sets a minimum and a maximum value for each dimension and then shows where each country stands in relation to these values, expressed as a number between 0 and 1. The higher a country’s HDI score, the higher its level of human development (and vice versa).:

The 3 indices in the HDI are:

Life expectancy: Life expectancy at birth and is:
1 when Life expectancy at birth = 85
0 when Life expe
ctancy at birth = 20.

Mean years of schooling – a country whose citizens all attained 15 years of education by the age of 25, would have an MYS index of 1.0.
Expected years of schooling – if every student in a country enrolled in a master’s degree that country’s EYS index would be 1.0

Standard of living: GNI per capita (PPP US$)
1 = $75,000 / annum
0 = $100 / annum

The new Subnational Human Development Index (SHDI)is a simple cross-nationally comparable index. While at the national level it coincides with the official HDI constructed by the UNDP, its subnational values reflect – in a globally comparable way – the variation in human development among geographic regions within countries. See graph below for New Zealand. Note that Wellington and Auckland have the highest SHDI score whllst Gisborne and Northland the lowest.

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