Neighborhoods in Development: Human Development Index and Self-organizing Maps

Abstract

The Human Development Index (HDI) has been instrumental in broadening the discussion of economic development beyond money-metric progress, in particular, by ranking a country against other countries in terms of the well being of their citizens. We propose self-organizing maps to explore similarities among countries using the components of the HDI rather than rankings. The similarities approach using the HDI components reveals information which is not available from ranking or bilateral comparisons. By illustrating clusters of countries, which we call neighborhoods in development, self-organizing maps draw out the potential for mutual policy learning among countries and shift the focus to discovering what kind of policies might have led countries change their position in the rankings.