Abstract

In spite the considerable advance made to the literature on development by the
recent United Nations attempt to measuring “human development”, this paper argues that,
especially in the context of developing countries, where poverty and inequality are of substantial
order, these two dimensions should be integrated and added to the index proposed by
that organism. This is accomplished by a new measure that simultaneously take into account
indices of poverty, income distribution and human development. Empirical results show that
the extension suggested is important and more appropriate for policy purposes.

JEL Classification: O15; I32.