GDP is an economic average of income and thus it has its flaws. SPI intends to fulfil the gaps which GDP based measurement has.
What is SPI?
SPI is based on three fundamental pillars:
- Basic needs for survival;
- Access to the building blocks to improve living conditions
- Access to opportunity to pursue goals and ambitions.
What is the difference between GDP and SPI?
- SPI focuses on outcomes rather than inputs that are used in GDP.
- For example, the quality of life and longevity are measured instead of spending on health care, and people’s experience of discrimination is looked at instead of focussing on whether there is a law against discrimination.
- SPI also reframes the fundamentals about development by taking into consideration not just GDP but also inclusive, sustainable growth that will lead to a significant improvement in people’s lives.
- SPI can best be described as a complementary index to GDP and can be used along with GDP to achieve social progress.
Conclusion:
- SPI can bring substantial betterment in the policy discourse on development.
- With the move to getting it introduced at a sub-national level, the index is expected to help development practitioners and other stakeholders in analysing well-being in a better manner.