For decades after the 2nd World War, after the United Nations Organization was set up, country-wise development was measured in terms of the Gross Domestic Product (GDP). Critics to this measure held that judging a country's development levels solely through factors that measure economic performance was insufficient as it failed to consider several other performance items, especially intangible humanitarian ones, that greatly indicated development levels in their variations from country to country.
In the early 1990s the United Nations took heed of this failing and introduced a new index for development: the Index of Human Development (IHD) (Wharton School, 2004). It is a simple measure and considers only three variables: per capita income, access to education and life expectancy. As of 2004, 175 of the United Nation's 191 countries use this index (Wharton School, 2004).
The 2003 "Human Development Index" Report brought out by the United Nations in collaboration with other international agencies like the World Bank and UNESCO rank Mexico in the 55th place while Brazil ranks in the 65th place. In all 175 countries are listed. Four data sets are considered, all belonging to the period 2000-2001. These are as follows:
It is clearly observable from the data sets that except for the "per capita income" set, which belongs to the economic category, the rest of the three sets belong to the demographic category. The indices are derived from the four data sets. Notes on the indices are as follows:
Dimension Index = (Actual Value - Minimum Value)/(Maximum Value - Minimum Value)
The HDI is then calculated as a simple average of the component indices.
The maximum and minimum values for the indicators are as follows:
Life expectancy at birth (years)
Adult literacy rate (%)
Combined gross enrolment ratio (%)
GDP per capita (PPP US$)
(Table data source: UNDP, 2003)
It is to be noted that Mexico is the last country to be categorized under the high HDI group (limits: 1.000-0.800) while Brazil belongs to the medium HDI group (limits: 0.799-0.500).
Though the HDI needs only four data sets, one economic and three demographic, it is being considered as the most efficient tool for determining the relative development for both Brazil and Mexico.