HDI in the age of 4th industrial revolution

February 9, 2020

Why should indicators of technology be included in assessing human development?

Dr Mahboob ul Haq introduced the concept of Human Ddevelopment Index (HDI) in 1990. The index is now recognised by governments, policymakers and relevant authorities all over the world. The HDI is considered a fundamental tool to shape policy.

HDI includes three major sectors: health, education and income. Although these three sectors cover most human development concerns but in the present era of technology, it seems HDI needs to expand itself and should include other indicators as well.

The present era, known as the age of 4th industrial revolution, is all about technological upgrades. The concept of 4th industrial revolution or Industry 4.0 was firstly introduced in Germany in 2011.

Using steam for power production is known as the first industrial revolution and electric power which is called the second industrial revolution. The use of information technology for production was called the third industrial revolution. The digital revolution is called the fourth industrial revolution.

The fourth industrial revolution is a mix of technologies which are clouding digital, biological and physical spheres.

How is the fourth industrial revolution connected with human development and why should indicators of technology be included in human development index? The answer is: to address increasing inequalities due to technological upgrades.

The revolution could produce greater inequalities, predominantly in its potential to disturb the labour markets. By replacing robotics with the labour force in the economy, it might increase the gap between revenues for the capital and earnings for the labour.

Inequality is not just an economic concern; it characterises the utmost social fear related with the fourth industrial revolution. The benefactors of knowledgeable and physical capital β€” the investors, innovators and shareholders β€” are the biggest beneficiaries of innovation.

For most of the population in countries with high income, incomes has stagnated or even decreased and the demand for low-skill and uneducated workers has decreased while the demand for highly skilled workers has increased.

Even in learning and education upgrades, the fourth industrial revolution is playing its part. Either it is by the face of podcasts, Khan Academy or YouTube channels, we can see and utilise these digital upgrades anywhere, anytime.

This has upset the structures of many industries. The techno-platforms are bringing new ideas about consuming goods and services in the process through smart phones and data-driven businesses. This is decreasing the hurdles to creating wealth and changing the professional and personal environment of workers. Businesses are rapidly changing by aligning themselves with the fourth industrial revolution, ranging from shopping to parking to travel and so on.

A strong pillar of the new world of technology is artificial intelligence (AI). AI is already everywhere β€” from drones to translating software, investing in self-driving vehicles, from Siri in I-phone to Bixby in Samsung.

In recent years, so much progress has been made in the field of AI through enormous amount of data and it’s computing through different software, use of algorithms for the discoveries of new drugs and from micro-organism studies to designing and architectures, from material engineering to addictive manufacturing and from our inhabitant buildings to consumption of our daily products.

Even in learning and education upgrades, the fourth industrial revolution is playing its part. Either it is by the face of podcasts, Khan Academy or YouTube channels, we can see and utilise these digital upgrades anywhere, anytime.

All the top ten countries in HDI this year are technologically advanced. This may be a reason of their improving scores on every indicator. The countries that went down on HDI during the past few years suffered because of lack of technological upgrades and not realising the importance of the fourth industrial revolution. Pakistan is one example.

The writer is a researcher based in Islamabad

HDI in the age of 4th industrial revolution