Validity of Development Indicators

• Single indicators like GNI are averages which can hide extremes within a country, with some areas of a country being much better off than others, such as north-south or ‘urban-rural’ contrasts or a rich minority and a poor majority.
• Development is not only about money, a high GNI doesn't show where the money is being spent, and it may not be going to improve health and education.
• GNI does not consider the informal economy, such as subsistence agriculture and ‘barter economies’, which accounts for a large proportion of wealth generated in some countries.
• GNI is always expressed as US dollars to allow comparison, however, exchange rates continually fluctuate making it harder to compare countries, making GNI unreliable.
• Composite indicators give a more rounded picture of development by combining several social and economic indicators.
• HDI is a combination of health, wealth and education indicators that help to show the quality of living for people in a country.