A new model suggestion in determining the development ranking of countries: Multi-criteria decision making

Human Development Index (HDI) is an index created by considering not only economic factors but also human factors such as education and health in determining the development of a country. The Human Development Report (HDR) was first published by the United Nations Development Program (UNDP) in 1990 and has been published regularly every year since then. The data in the HDR contains comprehensive statistics for all countries and, accordingly, countries are divided into four classes: countries with very high, high, medium and low development levels. The HDI is a summary measure of average achievement in key dimensions of human development. HDI calculations are based on a simple calculation method of normalizing the data of countries in the fields of economy, education and health and taking the geometric average of these values. One of the most important criticisms regarding the HDI calculations made by UNDP is that equal importance is assigned to the criteria used in the evaluation. It is a mistaken approach to assume that the economic dimension of human development has the same degree of importance as the health and education dimension. Therefore, assigning appropriate weight values to the criteria in measuring human development will yield more accurate results. Another notable problem in HDI calculation is the interaction between criteria. Ignoring the relationship between the welfare level criterion used in HDI calculation and the health level criterion will lead to calculation errors. Similarly, it is obvious that there is a high correlation between welfare level and education level. In this study, a new calculation method that considers inter-criteria dependency and different criterion weights, which have not been considered in HDI calculations until now, is proposed. Analytical Network Process (ANP), which is the most suitable method for the structure of the problem, was chosen to solve the problem at hand. The ANP method is an effective method developed by Thomas L. Saaty for solving complex Multi-Criteria Decision Making (MCDM) problems involving highly correlated criteria. In order to test the validity and reliability of the proposed method, two countries were randomly selected among the countries with very high, high, medium and low development levels. HDI values were calculated again with the recommended method for the selected countries and compared with current values. The results obtained showed that the proposed method produced healthier results. When the studies on HDI in the literature are examined, no study has been found that assigns different weight scores to the criteria used in the calculation by UNDP and considers the interaction between the criteria. It is thought that this aspect of the study will make significant contributions to the literature and produce a healthier human development ranking. Key Words: Development, Criteria, Decision Making, Index