Assignment 1 and 2:

Assignment 1 and 2:

Exercise 2:

 Below, you are given 2014 data of life expectancy at birth (years); expected years of
schooling (years); years of schooling (years), and GNI per capita (2011 PPP $) of 11
world countries. Accordingly:

1. Rank the world countries based on their GNI per capita (2011 PPP $) values.

2. Determine the HDI of the world countries.

3. Group the world countries into four based on their HDI values.

4. Rank the world countries based on their HDI values.

5. What is the position of Ethiopia according to its GNI per capita and HDI? Is there
any difference? What do you understand from the difference in rank by the two
criteria?

Table 1: Human Development Index components

Life Expected Mean GNI per
expectancy years of years of capita
at birth schooling schooling (2011 PPP
(years) (years) (years) $)
N0 Country (years) (years) (years)
1 Mali 58.0 8.4 2.0 1,583
2 Swaziland 49.0 11.3 7.1 5,542
3 Algeria 74.8 14.0 7.6 13,054
4 Andorra 81.3 13.5 9.6 43,978
5 Angola 52.3 11.4 4.7 6,822
6 Antigua and Barbuda 76.1 14.0 9.2 20,070
7 Malawi 62.8 10.8 4.3 747
8 Armenia 74.7 12.3 10.9 8,124
9 Australia 82.4 20.2 13.0 42,261
10 Austria 81.4 15.7 10.8 43,869
11 Ethiopia 64.1 8.5 2.4 1,428
12 Niger 61.4 5.4 1.5 908
Assignment 1 and 2:

Answers:
 To determine the Human Development Index (HDI) for each country, we need to use the
following formula:
 HDI = √

 The Life Expectancy Index is calculated as:

 Life Expectancy Index = (Ava LE - min)
(Max - min)

 The Education Index is calculated as:

 Education Index = (Expected Years of Schooling + (Mean Years of Schooling)
2
 Expected Years of Schooling
18
 Mean Years of Schooling
15
 The GNI per capita Index is calculated as:
 GNI per capita Index = Ln (Ava GNI per capita) – Ln (min)
Ln (Max) - Ln (min)
Whereas:
 Maximum GNI per capita (2011 PPP US$) = 75000
 Minimum GNI per capita (2011 PPP US$) = 100
Using the provided data, we can calculate the HDI for each country:

1. Mali:
 Life Expectancy Index = (58.0 - 20) / (85 - 20) = 0.585
 Expected Years of Schooling =8.4 = 0.467
18
 Mean Years of Schooling = 2.0 = 0.133
15
 Education Index = (0.467) + (0.133) = 0.3
2
 GNI per capita Index = ln (1,583) – ln (100) = 2.762 = 0.417
ln (75000) – ln (100) 6.620
 HDI = √ = 0.419
2. Swaziland:
 Life Expectancy Index = (49.0 - 20) / (85 - 20) = 29 / 65 ≈ 0.446
 Expected years of schooling index = (11.3 - 0) / (18 - 0) ≈ 0.628
 Mean years of schooling index = (7.1 - 0) / (15 - 0) ≈ 0.473
 Education Index = 0.628+0.473 = 0.551
2
 GNI per capita index = (log(5,542) - log(100)) / (log(75,000) - log(100)) ≈ 0.606
 HDI = √ = 0.53
Assignment 1 and 2:

3. Algeria:
 Life expectancy index = (74.8 - 20) / (85 - 20) = 54.8 / 65 ≈ 0.843
 Expected years of schooling index = (14.0 - 0) / (18 - 0) ≈ 0.778
 Mean years of schooling index = (7.6 - 0) / (15 - 0) ≈ 0.507
 Education index = 0.778 + 0.507 0.643
2
 GNI per capita index = (log (13,054) – log (100)) / (log (75,000) – log (100)) ≈ 0.736
 HDI = √ = 0.736
4. Andorra:
 Life Expectancy Index = (81.3 - 20) / (85 - 20) = 0.943
 Expected years of schooling index 13.5/18 = 0.75
 Mean years of schooling index 9.6/15=0.64
 Education Index = 0.75+0.64= 0.695
2
 GNI per capita Index = ln(43,978) - ln(100) /ln(75000)-ln(100) = 0.919
 HDI = √ = 0.842
5. Angola:

 Life Expectancy Index = (52.3 - 20) / (85 - 20) = 0.497

 Expected years of schooling 11.4/18= 0.633
 Mean years of schooling index 4.7/15 = 0.313
Education Index = (0.633) + (0.313) = 0.473
2
 GNI per capita Index = ln(6,822) - ln(100)/ln(75000)-ln(100) = 0.6
 HDI = √ = 0.531
6. Antigua and Barbuda:

 Life Expectancy Index = (76.1 - 20) / (85 - 20) =0.863

 Expected years of schooling 14/18= 0.778
 Mean years of schooling index 9.2/15= 0.613
 Education Index = (0.778) + (0.613) = 0.696
2
 GNI per capita Index = ln(20,070) - ln(100) /ln(75000)-ln(100) = 0.801
 HDI = √ = 0.784
7. Malawi:
 Life Expectancy Index = (62.8 - 20) / (85 - 20) = 0.658
 Expected years of schooling = 10.8/18 =0.6
 Mean years of schooling index = 4.3/15=0.287
 Education Index = (0.6) + (0.287) = 0.443
2
 GNI per capita Index = ln(747) - ln(100) /ln(75000)-ln(100) = 0.304
 HDI = √ = 0.446
Assignment 1 and 2:

8. Armenia:

 Life Expectancy Index = (74.7 - 20) / (85 - 20) = 0.842

 Expected years of schooling =12.3/18 = 0.683
 Mean years of schooling index = 10.9/15 =0.727
 Education Index = (0.683+0.727)/2 = 0.705
 GNI per capita Index = ln(8,124) - ln(100) /ln(75000)-ln(100) =0.664
 HDI = √ = 0.741

9. Australia:

 Life Expectancy Index = (82.4 - 20) / (85 - 20)= 0.96

 Expected years of schooling = 20.2/18 = 1.122
 Mean years of schooling index = 13/15 = 0.867
 Education Index = (1.122+.867)/2= 0.994
 GNI per capita Index = ln(42,261) - ln(100)/ln(75000)-ln(100) = 0.913
 HDI = √ = 0.955

10. Austria:
 Life Expectancy Index = (81.4 - 20) / (85 - 20) = 0.945
 Expected years of schooling = 15.7/18 = 0.872
 Mean years of schooling index = 10.8/15 = 0.72
 Education Index = (0.872 + 0.72)/2 = 0.796
 GNI per capita Index = ln(43,869) - ln(100)/ln(75000)-ln(100) = 0.919
 HDI = √ = 0.884

11. Ethiopia:

 Life Expectancy Index = (64.1 - 20) / (85 - 20) = 0.678

 Expected years of schooling = 8.5/18 = 0.472
 Mean years of schooling index = 2.5/15 = 0.167
 Education Index = (0.472 + 0.167)/2 = 0.32
 GNI per capita Index = ln(1,428) - ln(100) /ln(75000)-ln(100) = 0.402
 HDI = √ = 0.444

12. Niger:

 Life Expectancy Index = (61.4 - 20) / (85 - 20) = 0.678

 Expected years of schooling = 5.4/18 = 0.3
 Mean years of schooling index = 1.5/15 =0.1
 Education Index = (0.3 + (0.1)/2 = 0.2
 GNI per capita Index = ln(908) - ln(100)/ln(75000)-ln(100) = 0.333
 HDI = √ = 0.356
Assignment 1 and 2:

 Based on the given data, let’s rank the world countries based on their GNI per capita (2011 PPP $)
values. From largest to smallest (Descending order):
Based on GNI per capita ranking the world countries from
largest to Smallest
No Countries GNI value Rank
1 Andorra 0.919 1st
2 Austria 0.919 1st
3 Australia 0.913 3rd
4 Antigua and Barbuda 0.801 4th
5 Algeria 0.736 5th
6 Armenia 0.664 6th
7 Swaziland 0.606 7th
8 Angola 0.6 8th
9 Mali 0.417 9th
10 Ethiopia 0.402 10th
11 Niger 0.333 11th
12 Malawi 0.304 12th

 To group the world countries based on their HDI values, we need to know the specific ranges for
each group. The HDI ranges used for grouping may vary depending on the source or organization.
However, a common grouping based on HDI is as follows:

1. Very High Human Development (HDI above 0.8)

2. High Human Development (HDI between 0.7 and 0.799)

3. Medium Human Development (HDI between 0.55 and 0.699)

4. Low Human Development (HDI below 0.55)

 Next, let's group the world countries into four based on their HDI values.

Group 1: Very High Human Development

 Australia

 Andorra

 Austria
Assignment 1 and 2:

Group 2: High Human Development

 Algeria

 Antigua and Barbuda

 Armenia

Group 3: Medium Human Development

 Angola

 Swaziland

Group 4: Low Human Development

 Malawi

 Ethiopia

 Mali

 Niger

Let's rank the world countries based on their HDI values

No Countries HDI value Rank
1 Australia 0.955 1st
2 Austria 0.884 2nd
3 Andorra 0.842 3rd
4 Antigua and Barbuda 0.784 4th
5 Armenia 0.741 5th
6 Algeria 0.736 6th
7 Angola 0.531 7th
8 Swaziland 0.53 8th
9 Malawi 0.446 9th
10 Ethiopia 0.444 10th
11 Mali 0.419 11th
12 Niger 0.356 12th

According to the given data, Ethiopia is ranked 10th in terms of GNI per capita and 10th in terms of HDI.
There is no difference in the rankings based on these two criteria for Ethiopia.
From the rankings, we can understand that Ethiopia has a relatively low GNI per capita compared to
other countries in the data set, indicating a lower economic development level. However, its HDI ranking
suggests that Ethiopia has made progress in terms of human development, considering factors such as
life expectancy, education, and income. The HDI takes into account multiple indicators, including health
and education, which provides a more comprehensive view of a country's development beyond just
economic measures.