A country with a high level of wealth and resources available to its residents or citizens
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The Human Development Index assigns countries with a score between 0 and 1 using measures such as “long and healthy life,” “education,” and “standards of living,” while the World Happiness Index measures wellbeing through surveying the overall “level of happiness.”
Although the measurements are not directly related to economic development, developed economies still tend to score higher. Further, these correlations highlight important relationships between non-economic factors and more productive economies.
That is, bettering a country’s non-economic factors – such as education and health care for citizens – is vital to better economic development.
Of course, it is important to achieve a high level of productivity and income in order for an economy to become more developed.
However, research suggests that for developed economies, productivity and income come from the production of goods and services instead of natural resource extractions.
Higher developed economies tend to have governments or polities that are responsive to the preference of its citizens. That is, a government is judged based on performance and reflects the opinions of the people it serves.
Contemporarily, democracy seems to achieve this point somewhat haphazardly, as many of the developed economies in the world are democracies.
The aspect of society touches upon the availability of opportunities for citizens of different demographics to achieve personal success. The researchers espouse the view that, for economic development to occur, people must believe that they can succeed.
The intuitive conduit is that when people believe they can succeed, individuals will work and be rewarded for innovation and higher productivity, which leads to economic development.
Administration refers to the capability for a government to implement its policies effectively and efficiently – as opposed to polities, which refers to a government that enacts policies as preferred by its citizens.
The importance of implementation is the perception of citizens regarding what the government is stating. In other words, the people of a country must believe a government in order to act upon governmental policies that encourage economic development.
Examples Across Different Countries
As mentioned above, developed countries tend to achieve better measurements on both economic and non-economic proxies.
As an example, three countries with developed economies and three without are listed below. Their respective GDP per capita in 2018 (in US dollars) and HDI scores (in 2019) are also provided.
Canada: The GDP per capita in 2018 was $46,233, and its HDI score in 2019 was 0.922.
The United Kingdom: The GDP per capita in 2018 was $42,944, and its HDI score in 2019 was 0.920.
The United States: The GDP per capita in 2018 was $62,795, and its HDI score in 2019 was 0.920.
China: The GDP per capita in 2018 was $9,771, and its HDI score in 2019 was 0.758.
India: The GDP per capita in 2018 was $2,010, and its HDI score in 2019 was 0.647.
Pakistan: The GDP per capita in 2018 was $1,482, and its HDI score in 2019 was 0.560.
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