Question

Why are averages used to measure HDI? Are there any limitations to their use?

Answer 1

We use averages because they are useful for comparing differing quantities of the same category. For example, to compute the per capita income of a country, averages have to be used because there are differences in the incomes of diverse people. However, there are limitations to the use of averages. This does not show the distribution of thing between people. For an example, if a country has very high per capita income then we can’t say that citizen living in that country is very rich because we are not knowing about the distribution of wealth in that country. Some people might be richer while other people are very poorer in that country.