Per-Capita Income and the Physical Quality of Life Index (PQLI)

The simplest, most widely quoted indicator of a country's economic well-being is per-capita income:

It converts a country's total income into an 'average income per person', letting economies of very different sizes be compared on a common footing, and letting the same economy be tracked over time to see whether average incomes are rising faster or slower than the population.

Per-capita income has a well-known limitation, though: it is an average, and an average can rise even while most people are no better off, if the increase is concentrated among a small, already-wealthy section of the population. It also says nothing about health, education, or the quality of life the income is actually purchasing.

To address this, economist Morris D. Morris proposed the Physical Quality of Life Index (PQLI), which combines three basic, non-monetary indicators of well-being:

1. Infant Mortality Rate — the number of infant deaths (under one year) per 1,000 live births, an indicator of a society's basic health and nutrition standards.
2. Life Expectancy at Age One — the average number of further years a one-year-old is expected to live, reflecting overall health and access to healthcare across the life-course.
3. Basic Literacy Rate — the proportion of the population that can read and write, reflecting access to basic education. …