Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259537 
Year of Publication: 
2021
Series/Report no.: 
LEM Working Paper Series No. 2021/42
Publisher: 
Scuola Superiore Sant'Anna, Laboratory of Economics and Management (LEM), Pisa
Abstract: 
We argue against the use of composite indices, such as the Human Development Index (HDI), in economic history. We show that the HDI can be interpreted as a formal representation of the analyst's ethical system. We support our claim by introducing a new class of paternalistic social welfare functions (Graaff 1957, Mas-Colell, 1995) which encompasses all the HDI formulas put forth by the literature. The theoretical framework is illustrated by an empirical investigation of the long-run evolution of Italians' living standards and civic liberties. We conclude that any history based on composite indices is one where both data and history play a minor role, if any.
Subjects: 
Human development index
economic wellbeing
composite indices
living standards
CES
social welfare functions
Italy
JEL: 
N01
N3
O15
Document Type: 
Working Paper

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