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Thursday, May 02, 2002

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Do humans develop?

D. Murali

IF you are interested in economic attainments and well being (who is not!), read chapter 3 of the latest National Human Development Report that was out a few weeks ago. Traditionally, people were made to feel good if what they earned was more than a benchmark figure, derived from macro measures such as per capita income or per capita GDP. Now, there is a shift to per capita consumption expenditure.

What you spend is more important, therefore, than what you earn. And everybody secretly yearns to spend more than what they earn, though avenues are few where you can secretly earn.

Many reasons have been given by the Planning Commission that has brought out the report for switching over to the new indicator, including quite a few that many won't understand. What is, however, most important is this: "Given large-scale under-reporting of income data in developing countries, use of consumption data may capture an individual's command over resources more accurately." The latest acceptance of what we all knew as `given'.

They adjusted the expenditure measure using Gini Ratios to remove `inequality'. A powerful genie! Interestingly, as we `develop', the proportion of expenditure on food declines. "Does it mean we eat less as we earn more!" you could be asking, with an ice cream in your hands. Proportion is the key word. However, I doubt whether this really happens when I see people crowding canteens and fast-food joints and doing nothing but pushing things down their gullets whenever time permits.

Well, there are other indicators also, such as employment, poverty, housing, toilet, water, electricity and roads. A person is considered working or employed if he "was engaged for a relatively longer time during the preceding year in any one or more work related activities." Check if you are employed. Okay, what is poverty? It is a state of `deprivation', reflecting the `inability of an individual to satisfy certain basic minimum needs for a sustained, healthy and a reasonably productive living'. With the current business mood and price levels, everyone seems to be going about with that `poor paavam look' on their faces, and so it is difficult to find out who is poor. An accepted measure, therefore, is whether you can afford to get eats that can get you 2,100 to 2,400 kilo calories per day. If you get more, you are rich. Otherwise, poor. The problem with those who have money to burn is how to burn the extra calories, while for the poor the all-important question is how to earn the calories by burning themselves.

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