Dissertation presented as the partial requirement for obtaining a Master's degree in Statistics and Information Management, specialization in Risk Analysis and ManagementMuch critique has been made towards the Human Development Index (HDI) in the current
development debate. The composite Index is widely used as the standard measure to evaluate human
development and progress across countries by comprising income, health, and education measures.
However, it has been proved that other welfare measures, such as governance, personal safety and
environment and its sustainability, are of importance to human well-being and, therefore, should be
included. This study seeks to contribute to the debate on how the human development of a country
should be measured by proposing a composite Index that builds on new aggregation formulas and
incorporates several essential aspects of life. Specifically, the indicator widens the scope of the HDI
and attempts to find which is the most developed country in the world based on the analysed
measures.
In this research, three alternative aggregation methods are performed on seven aspects of human
well-being, an addition of security, lifestyle, governance, and environmental sustainability dimensions,
which translates into three distinctive Indices. Principal Component Analysis (PCA) is performed on
one of the Indices. The second and third Indices are computed by weighting and aggregating the data,
where equal weights are assigned to all variables and dimensions, respectively. The resulting values of
these Indices and country rankings are analysed and compared against the HDI. These results suggest
that the worldview may be seriously distorted as problems of governance and sustainability are not
considered when accessing human well-being
