Examining the Relationships between GII, HDI, Gini, and GDP per capita -A Comparative Analysis of Undeveloped and Developed Countries (1990-2021)

Abstract

This thesis examines and evaluates key measurements, namely the Gender Inequality Index (GII), Human Development Index (HDI), Gini coefficient (a measure of income and wealth inequality), and GDP per capita. Further, this study investigates the strengths and weaknesses of each measurement, providing a comprehensive background on previous research and their interrelationships. The study compares these measurements among undeveloped and developed countries, encompassing 193 countries from 1990 to 2021. The data section analyzes correlations between the measurements and explores the reasons behind these correlations. Notably, a strong positive correlation is found between GDP per capita and GII, which is the strongest correlation, while HDI and Gini exhibit the weakest correlation in the correlation matrix. The results and analysis section presents regressions that are connected to the literature review. It reveals that an increase in HDI is positively associated with GDP per capita, especially in undeveloped countries. Conversely, a higher GII indicates a negative relationship with GDP per capita, and an increased Gini suggests a positive association with GDP per capita. However, these relationships are weaker in developed countries, partly due to diminishing marginal returns. Lastly, a sensitivity analysis is conducted by imposing restrictions on the Gini coefficient and the time period to strengthen the findings.