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The HDI based on unlogged income index (HDI*) is thencalculated: Assuming that the percentage loss due toinequality in income distribution is the same for both averageincome and its logarithm, the IHDI is then calculatedas: IHDI = IHDI* HDI* . HDI = 3 (1–ALife ).
Just so, how is the IHDI different from the HDI?
Under perfect equality the IHDI is equal to theHDI, but falls below the HDI when inequality rises.The difference between the IHDI and HDI is thehuman development cost of inequality, also termed – the lossto human development due to inequality.
All nations ranked as having very high human development, rankedby highest score, are:
- Norway.
- Switzerland.
- Australia.
- Ireland.
- Germany.
- Iceland.
- Hong Kong.
- Sweden.
Accordingly, why is the HDI of a country adjusted to an IHDI?
The HDI represents a national averageof human development achievements in the three basic dimensionsmaking up the HDI: health, education and income. Like allaverages, it conceals disparities in human development across thepopulation within the same country.
World map of all countries by the inequality-adjustedHuman Development Index. World map representing theinequality-adjusted Human Development Index categories(based on 2017 data, published in 2018).
Above average (0.582):
| Rank | Country | IHDI |
|---|---|---|
| 1 | Iceland | 0.878 |
| 2 | Japan | 0.876 |
| 2 | Norway | 0.876 |
| 4 | Switzerland | 0.871 |