HUMAN DEVELOPMENT AND SOCIO-ECONOMIC DEVELOPMENT INDEXES

Human development is a key factor that goes beyond economic growth, focusing on improving individuals’ well-being, quality of life, and access to opportunities. In recent decades, Türkiye has placed significant emphasis on enhancing not just its economic output but also the living standards and social welfare of its population. This approach aligns with global trends where success is measured not only by income but through a broader lens of health, education, and overall well-being.

As the global economy shifts towards sustainable growth, investors are increasingly looking at these human development metrics to assess the long-term potential of markets. Türkiye’s progress in this area is highlighted by comprehensive tools like the Human Development Index (HDI) and the Socio-Economic Development Ranking (SEGE). These indices, developed by the United Nations Development Programme (UNDP) and the Ministry of Industry and Technology of the Republic of Türkiye, provide a holistic view of Türkiye’s development, measuring crucial aspects like living standards, educational access, and healthcare.

Moreover, Türkiye’s commitment to regional development is exemplified by localized measures such as the Human Development Index-Districts (HDI-D), introduced by the Human Development Foundation (İNGEV). This tool analyzes human development at the district level, offering insights into regional disparities and opportunities for growth. For stakeholders interested in Türkiye’s long-term trajectory, these indices offer invaluable data on both national and regional development trends, providing a clearer picture of the country’s overall potential.

This article explores Türkiye’s human and socio-economic development by examining key indices such as the HDI, SEGE, and HDI-D. Understanding these metrics allows for a deeper appreciation of Türkiye’s diverse regions and their unique opportunities, paving the way for more informed strategic decisions in an evolving economic landscape.

HUMAN DEVELOPMENT INDEX

Human development is seen as both a means and an ultimate goal of the development process, contributing to the formation of human capital by generally enhancing individuals’ knowledge, skills, creativity, and productivity. Human development emphasizes participation in economic growth and the ability of individuals to benefit from increasing income, linking economic conditions to individuals’ living conditions.

Technological and knowledge-based advancements in the 1950s increased economic and social development disparities globally, reigniting interest in economic growth and development. The global economic crises and imbalances of the 1970s, even in developed economies, led to issues such as poverty, unemployment, and income inequality. These problems prompted a re-evaluation of economic development and growth, along with criticisms that GDP did not fully reflect levels of well-being. As a result, the Human Development Approach was introduced by the United Nations in 1990.

The human development approach is based on Nobel laureate Amartya Sen’s capability approach, which advocates for individuals to possess a combination of capabilities necessary to live the life they desire. The index was first created in 1990 by Pakistani economist Mahbub Ul Haq, in collaboration with Amartya Sen and other thinkers. The primary aim of the report was to highlight the importance of people within national and global development policies and to draw international attention to the quality of life of individuals (Dikme & Büyükerkan, 2020).

The Human Development Index (HDI) is defined as an index that measures average achievements in three key areas of human development: health, income, and education (Dikme & Büyükerkan, 2020). In this context, the HDI is a summary indicator that measures people’s success in leading a long and healthy life, accessing knowledge, and achieving a decent standard of living. The HDI is calculated using the geometric mean of normalized indices for these three dimensions (UNDP, n.d.).

The three core components of the HDI are explained as follows:

1. Health (Life Expectancy): The measurement of a long and healthy life is based on the expected average life expectancy at birth. These statistics are collected based on UNDESA data (UNDP, n.d.).
2. Education: Education is the foundation of a productive life and ensures the formation of healthy societies, equality, and justice. The education component is measured by the expected and average school enrollment rates. The expected school enrollment period is calculated using sources such as UNESCO Institute for Statistics (2020), ICF Macro Demographic and Health Surveys (2008-2020), United Nations Children’s Fund (UNICEF) Multiple Indicator Cluster Surveys (2008-2020), and OECD (2019). The average learning period is based on sources like UNESCO Institute for Statistics (2020), Barro and Lee (2018), ICF Macro Demographic and Health Surveys (2008-2020), UNICEF Multiple Indicator Cluster Surveys (2008-2020), and OECD (2019) (UNDP, n.d.).
3. Income Level: Income is a critical factor in life expectancy and access to necessary resources. Per capita GNI is calculated based on sources such as the World Bank (2020), IMF (2020), and the United Nations Statistics Division (2020) (UNDP, n.d.).

Changes and updates made in the process of developing the HDI have improved its definition and calculation methods. In 1990, the HDI ranked countries from worst to best for each component, with the Education Index based solely on adult literacy and the Income Index calculated using the logarithm of GDP per capita. In 1991, the ranking was changed from best (#1) to worst (#160), and the Education Index began to be calculated based on adult literacy and average school enrolment years. In 1995, the Education Index was calculated by combining adult literacy and gross enrolment rates. In 1999, the Income Index was revised based on the natural logarithm of GDP per capita. These changes have allowed the HDI to measure countries’ human development levels more comprehensively and effectively over time (Stanton 2007). In particular, the 2010 innovations included updates to the standards of living and education criteria (UNDP, 2020). While the three components (education, health, income) remained unchanged after the 20-year revisions, the criteria used for education and income measurement were altered. For education, new indicators were introduced to reflect the average years of adult education and the total number of years a child of school age is expected to spend in education. This change was made because previous criteria could not differentiate between countries with high school enrolment and literacy rates. For income measurement, per capita GNI replaced GDP per capita adjusted for purchasing power parity (PPP). This change was made because, although GDP reflects economic output, it does not represent a country’s disposable income (Şeker, 2011).

Türkiye’s HDI values and rankings have fluctuated over time due to changing calculation methods and the standardization of international data. Since 1990, Türkiye’s HDI values have shown an upward trend, reflecting improvements in Türkiye’s health, education, and income levels. Particularly, the increases in life expectancy, average schooling duration, and expected schooling years demonstrate the progress Türkiye has made in the area of human development (UNDP, 2020).

It has been identified that the HDI contains some deficiencies in the comprehensive measurement of development, particularly in providing sufficient information in areas such as income and gender inequality. To address these shortcomings, the UNDP has added new indices to the Human Development Report, such as the Gender Development Index (GDI), Gender Inequality Index (GII), and Inequality-adjusted Human Development Index (IHDI), which assess inequality in greater detail (Zor, 2020). Additionally, the Human Development Report includes new complementary indices such as the Multidimensional Poverty Index (MPI) and the Planetary Pressures-adjusted HDI (PHDI) (UNDP, 2022b).

As of 2022, Türkiye’s HDI value was calculated at 0.855, placing the country in the “very high human development” category, ranking 45th among 193 countries and regions. From 1990 to 2021, Türkiye’s HDI value rose from 0.598 to 0.855, reflecting a 43% change. During this period, Türkiye’s life expectancy at birth increased by 10.8 years, the average schooling duration increased by 4.4 years, and the expected schooling duration increased by 10.8 years, while GDP per capita grew by approximately 154.3% (UNDP, 2023).

The Gender Development Index (GDI) evaluates gender inequalities in the three key dimensions of human development: health, knowledge, and living standards. The health dimension is measured by the estimated average life expectancy of men and women, the knowledge dimension by the expected education years of girls and boys and the average education years of men and women over 25, and the living standards dimension by the estimated GNI per capita for men and women. The GDI indicates the ratio of women’s HDI value to men’s HDI value. In 2022, Türkiye’s GDI value was 0.825 for women and 0.876 for men, resulting in a GDI value of 0.941 (UNDP, 2023).

In terms of the Inequality-adjusted HDI (IHDI), Türkiye’s 2022 loss was calculated at 16.1%, reducing its HDI to 0.717. This figure demonstrates the significant impact of inequalities on human development in the country (UNDP, 2023).

The Gender Inequality Index (GII) evaluates the loss of human development due to disparities between genders in three main areas: reproductive health, empowerment, and the labour market. Reproductive health is measured by maternal mortality rates and adolescent fertility rates; empowerment is assessed by the percentage of parliamentary seats held by men and women and the percentage of the population with at least secondary education; and the labour market is analysed by the labour force participation rates of men and women. In 2022, Türkiye ranked 63rd out of 166 countries with a GII value of 0.259 (UNDP, 2023).

The Multidimensional Poverty Index (MPI) is a tool that goes beyond income to understand the ways people experience poverty in dimensions such as health, education, and living standards. However, due to the lack of data to calculate this index, the MPI for Türkiye has not been computed (UNDP, 2023).
Finally, the Planetary Pressures-adjusted HDI considers environmental pressures by adjusting for factors such as per capita carbon dioxide emissions and material footprint, highlighting the issue of intergenerational inequality. In an ideal scenario, the PHDI and HDI would be equal, but as pressures increase, the PHDI falls below the HDI. In this context, Türkiye’s PHDI in 2022 was calculated at 0.783, which is above the world average (UNDP, 2023).
While the Global Human Development Index measures variables related to central governments, İNGEV, aiming to localize HDI indices, has developed the Human Development Index-Districts (HDI-D), which evaluates the human development performance of approximately 200 districts by considering the short- and long-term performance of local governments and the effects of the central government (Şeker et al., 2021).

In the process of developing the HDI-D model, a total of 81 indicators across nine main categories were considered to comprehensively evaluate the human development performance of local governments. These categories cover a wide range of aspects reflecting the needs and priorities of local communities: Governance and Transparency, Social Inclusion, Economic Status, Education, Health, Social Life, Environmental Performance, Gender Equality, and Transportation and Accessibility. Each category aims to address different aspects of the districts, drawing a holistic picture of human development. These indicators were used both to analyse the current situation of local governments and to determine future development directions (Şeker et al., 2021).
According to the results of the 2021 HDI-D study, of the 160 districts examined, 40 were classified as having Very High Human Development, 51 as High Human Development, 44 as Medium Human Development, and 25 as Low Human Development (Şeker et al., 2021).

Table 1: Distribution of Districts with the Highest and Lowest Human Development Levels by Province, according to İNGEV Data

Source: Prepared using 2021 İNGEV HDI-D data.

The districts in various cities of Türkiye show significant differences in terms of human development levels. Istanbul, with 18 districts in the top 30, is the most represented city in this category. This data indicates that many of Istanbul’s districts score high on the human development index, reflecting the city’s overall high quality of life. Ankara and İzmir each have 3 districts in the top 30 but are also represented with 9 districts each in the bottom 30. This suggests that the districts of these cities display significant variation in human development. While some districts exhibit high levels of human development, others require significant improvements. Şanlıurfa, with 4 districts in the bottom 30, indicates that certain districts in this city need more support to improve human development levels.

SOCIO-ECONOMIC DEVELOPMENT RANKING STUDIES

The Socio-Economic Development Ranking Studies (SEGE), conducted by the Ministry of Industry and Technology of the Republic of Türkiye, serve as an objective analysis measuring and comparing socio-economic development levels between Level-2 regions, cities, and districts in Türkiye. The purpose of these studies is to provide data and information for policymaking, strategy development, and public services (T.C. Ministry of Industry and Technology, n.d.). The Nomenclature of Territorial Units for Statistics (NUTS), created in 1999 when Türkiye was accepted as a candidate for the European Union, is a system that divides Türkiye into three statistical levels. There are 12 Level-1 regions, 26 Level-2 regions, and 81 Level-3 regions. The purpose of NUTS is to make Türkiye’s statistical data more detailed and comparable, and aligned with the EU (Taş, 2006).

The SEGE studies in Türkiye’s provinces and districts aim to measure socio-economic development levels. SEGE studies for provinces have been conducted eight times since 1969, with the most recent one in 2017. SEGE studies for districts have been conducted six times since 1966, with the most recent in 2022 (T.C. Ministry of Industry and Technology, n.d.).

The 2017 SEGE study for provinces covered all 81 provinces of Türkiye, using 52 variables to measure socio-economic development. Based on these analyses, provinces and Level-2 regions were classified into six and four development tiers, respectively, according to index scores and natural breakpoints (T.C. Ministry of Industry and Technology, n.d.).

The 2022 SEGE study for districts covered 973 districts, using 56 variables to measure socio-economic development. Based on this study, districts were classified into six different development tiers, according to index scores and natural breakpoints (SEGE, 2022).

SEGE-2017 was prepared with 52 variables covering eight different sub-dimensions representing socio-economic development. The analyses, which took into account elements like income representing provinces’ and regions’ economic size and individual welfare, served as a foundation for directing investments and conducting spatial analyses. During the preparation of SEGE-2017, advances in multivariate analysis methods, such as Robust Principal Component Analysis (RPCA), were examined and applied in SEGE-2017 (SEGE, 2017).

The variables were derived from international organizations’ studies and the indexing efforts of the OECD. In selecting these variables, criteria such as reflecting provinces’ economic and social development levels, their impact on individual welfare, the continuity of data availability, and statistical significance were considered (SEGE, 2017).

The 52 variables used in the SEGE-2017 study were categorized into eight sub-dimensions. Demographic Variables are critical for understanding a province’s development level, reflecting the basic characteristics of the population. These variables include population density, age-specific fertility rates, net migration rate, and urbanization rate. Population density reflects the number of people in an area, fertility rates indicate the level of fertility among individuals in specific age groups, net migration rate reflects the difference between people entering and leaving a region, and urbanization rate shows the proportion of the population living in cities (SEGE, 2017).

Employment Variables measure a province’s economic strength and the condition of the labor market. These variables include the unemployment rate, labor force participation rate, and the proportion of the working-age population. The unemployment rate reflects the percentage of people seeking jobs but unable to find employment; the labor force participation rate indicates the degree to which people of working age are participating in the workforce; and the working-age population proportion reflects the percentage of working-age individuals in the total population (SEGE, 2017).

Education Variables indicate a region’s level of education and developments in this field. This category includes variables such as the literacy rate for women, net enrollment rates for general secondary education, and enrollment rates for vocational and technical high schools. The literacy rate for women indicates the percentage of the female population that is literate, while enrollment rates show the percentage of students in specific education stages as a proportion of the relevant age group (SEGE, 2017).

Health Variables reflect individuals’ access to healthcare services and general health status. These variables include the number of hospital beds, the number of physicians, the number of dentists, and the number of pharmacies. The number of hospital beds indicates the total bed capacity in a region; the number of physicians and dentists reflects the availability of healthcare professionals; and the number of pharmacies indicates access to medication and health services (SEGE, 2017).

Competitiveness and Innovation Capacity Variables measure a province’s economic and innovative capacities. Variables in this category include per capita export figures, the share of manufacturing industry workplaces, and industrial electricity consumption. Export figures indicate a region’s openness to external markets and economic performance; manufacturing industry workplaces reflect the importance of the industrial sector in the regional economy; and industrial electricity consumption indicates the level of industrialization and energy use (SEGE, 2017).

Financial Variables determine the financial soundness and economic activity of provinces. Variables in this category include the proportion of bank loans, per capita bank deposits, and internet banking usage rates. The proportion of bank loans indicates access to credit and financial depth; per capita deposits reflect individuals’ financial saving tendencies; and internet banking usage shows demand for and access to digital banking services. These variables play a crucial role in understanding a region’s financial status and economic development (SEGE, 2017).

Accessibility Variables measure how easily individuals can access essential services and amenities. These include access to the transportation network, internet access, access to public services, and public transportation access. For example, the quality of road, rail, and air connections in a region, the prevalence of internet connections in homes and businesses, the ease of access to education, healthcare, and social services, and the extent of the public transportation network are all evaluated in this category (SEGE, 2017).

Quality of Life Variables encompass a region’s general living standards and the quality of life for citizens. These include access to healthcare services, education quality and accessibility, environmental quality, and social security and support services. Access to hospitals, clinics, and healthcare centers, the number and quality of schools, environmental factors such as air and water quality, and the availability and accessibility of social services such as social assistance, disability services, and elderly care are important in this category (SEGE, 2017).

According to the results of SEGE 2017, which reflect the socio-economic development levels of different regions in Türkiye, Istanbul, Ankara, İzmir, Kocaeli, Antalya, Bursa, Eskişehir, Muğla, and Tekirdağ are in the first development tier, representing Türkiye’s economic, educational, and tourism hubs. In the second development tier, 15 provinces with index values between 0.923 and 0.476 are positioned. These provinces are generally located around the provinces in the first tier and serve as sub-centers in certain sectors. For example, Sakarya and Konya stand out with their competitiveness and innovation capacities. In the third development tier, 13 provinces with index values ranging from 0.413 to 0.170 are located. Trabzon and Kırıkkale rank highly in education and health, while Adana stands out in agricultural production. The 14 provinces in the fourth development tier have index values between -0.054 and -0.271, with Hatay standing out in competitiveness and innovation capacity. The provinces in the fifth and sixth development tiers generally have below-average values, mostly located in the Eastern and Southeastern Anatolia regions, and face more challenging socio-economic conditions (SEGE, 2017).

Although SEGE 2017 was the last province-based study conducted by the Ministry of Industry and Technology, the district-based socio-economic development ranking of 973 districts published in 2022 may provide clues regarding the current relevance of provincial development scores. In this context, the details comparing both the 2017 SEGE provincial scores and tiers with the 2022 SEGE district scores and tiers are presented in Table 2.

Table 2: Province SEGE 2017 and District SEGE 2022

Source: Prepared using data from the T.C. Ministry of Industry and Technology’s SEGE 2017 Provincial and SEGE 2022 District reports.

As outlined in Table 2, the provinces that ranked at the top in the SEGE 2017 provincial study in terms of socio-economic development also have districts classified within the first socio-economic development tier in the SEGE 2022 district report. For example, Istanbul, with 29 districts in the first tier, hosts the largest number of districts in this category, while Ankara has 5 districts in this tier. İzmir, with 10 districts, holds a notable third place. Kocaeli and Antalya each have 2 and 3 districts, respectively, in the first tier, and Bursa also has 2 districts in this group. Eskişehir and Muğla each have 1 district in the first tier, whereas Tekirdağ has no districts in this category. This data suggests that these provinces generally maintain high socio-economic development levels, which are reflected at the district level as well. However, despite being classified as a first-tier province in the SEGE 2017 provincial ranking, Tekirdağ does not have any first-tier districts in the SEGE 2022 district report, indicating that the socio-economic situation within Tekirdağ might not be uniform across its districts (in the 2017 district-based SEGE, Tekirdağ included two first-tier districts).

On the other hand, provinces such as Çanakkale and Erzurum present a different picture. Despite being evaluated as a second-tier province in SEGE 2017, Çanakkale has two first-tier districts in 2022, indicating that certain districts have experienced faster socio-economic development than the province overall. Similarly, Erzurum, ranked in the fourth tier in the SEGE 2017 provincial study, has a first-tier district in the SEGE 2022 district report, demonstrating that specific districts have shown significant progress independent of the general provincial condition. These examples illustrate the great diversity in socio-economic development levels across provinces and districts in Türkiye and show how general trends can be influenced by local dynamics.

On the other hand, the absence of updated provincial socio-economic development scores from the Ministry of Industry and Technology since 2017 represents a limitation. However, comparing the changes in the district-level rankings from the last two SEGE district reports (SEGE 2017 and SEGE 2022) for the top 30 and bottom 30 provinces in terms of development scores can provide important insights into the current state of provincial development levels. This comparison is based on the number of districts in the top 30 and bottom 30 provinces that are ranked in the 3rd and lower tiers. This method is used to analyse whether underdevelopment rates have increased or decreased in the provinces.

In this context, Figure 2 compares the number of districts in the bottom three tiers in the 30 most developed cities, based on the 2017 SEGE scores, from the SEGE 2017 and SEGE 2022 district reports. The number of districts in the bottom three tiers in cities such as Istanbul, Sakarya, Bolu, Kırklareli, Çanakkale, Karabük, and Trabzon has not changed. This suggests that these cities have not experienced significant socio-economic changes at the district level over the past five years. Notably, no districts in Istanbul or Yalova fall into the lower tiers, indicating that these cities have maintained high levels of socio-economic development across their districts.

On the other hand, in cities such as Ankara, İzmir, Antalya, Bursa, Eskişehir, Muğla, Tekirdağ, Denizli, Konya, Aydın, Isparta, Kayseri, Bilecik, Edirne, Manisa, Balıkesir, Mersin, Adana, and Uşak, the number of districts in the lower tiers has increased. This suggests that some districts in these cities have experienced socio-economic decline or slower development. In particular, the number of districts in the lower tiers has increased significantly in Eskişehir, Denizli, Ankara, and Manisa, indicating large-scale regression in certain districts within these cities.

Figure 1: Comparison of Changes in the First Three Tiers Between SEGE 2017 and SEGE 2022 District Rankings

In Figure 2, based on the district SEGE scores for 2017 and 2022, the number of districts in the bottom three tiers of the 30 least developed cities according to the 2017 SEGE scores is shown. These data provide an important resource for understanding changes and developments in cities’ socio-economic indices after 2017. Compared to 2017, some cities have shown district-level improvements. For example, in Kahramanmaraş, Adıyaman, Mardin, Muş, and Şırnak, fewer districts fall within the lowest tiers in 2022 compared to 2017. This indicates that certain districts in these cities have developed socio-economically.

On the other hand, in cities such as Sinop, Giresun, Çankırı, Tokat, Tunceli, Ordu, Erzurum, Gümüşhane, and Van, the number of districts in the bottom three tiers has increased. This suggests that districts in these cities have socio-economically regressed or developed more slowly compared to other cities. According to the findings, no significant changes were observed in cities such as Osmaniye, Niğde, Kilis, Bayburt, Ardahan, Iğdır, Bingöl, Batman, Şanlıurfa, Bitlis, and Ağrı. This shows that these cities did not experience significant socio-economic changes over the past five years.
Based on the data, 9 cities showed improvements in their district-level socio-economic development, while 7 cities experienced a decline in this regard. For 14 cities, there were no cumulative changes.

Overall, these tables offer valuable insights into the socio-economic development of districts across different regions in Türkiye over time. However, these tables alone may not provide a complete understanding of the development levels of cities post-2017. The similarity between the rates of increase and decrease indicates that, between 2017 and 2022, there was no notable difference in Türkiye’s less developed districts.

Figure 2: Comparison of Changes in the Last Three Tiers Between SEGE 2017 and SEGE 2022 District Rankings

The Human Development Index (HDI) is considered one of the most fundamental measures of the development process, focusing on improving individuals’ quality of life. The HDI comprehensively evaluates the progress of countries and regions in key areas such as health, education, and income. However, due to concerns that the HDI’s reliance on these three core components might not sufficiently address critical factors like income and gender inequality, new indices were developed. These include the Gender Development Index (GDI), Gender Inequality Index (GII), and the Inequality-Adjusted Human Development Index (IHDI), allowing for a more detailed and in-depth evaluation. Additionally, the Multidimensional Poverty Index (MPI) and the Planetary Pressures-Adjusted Human Development Index (PHDI), which are part of the Human Development Report, expand the scope of the index, enabling a more comprehensive consideration of human development.

As of 2022, Türkiye entered the very high human development category, ranking 45th out of 193 countries, demonstrating significant progress over the past 30 years.  The Human Development Index for Districts (HDI-D), developed by the İNGEV Foundation, contributes significantly as a tool for assessing the human development performance of local governments. This index more clearly reveals the differences and needs at the local level and helps guide policy development processes for local governments. The Socio-Economic Development Ranking Studies (SEGE), conducted by the T.C. Ministry of Industry and Technology, compare socio-economic development levels at the provincial and district levels. These analyses serve as the foundation for directing investments and spatial analyses. The Provincial and District SEGE 2017 and District SEGE 2022 studies clearly highlight socio-economic development disparities between different regions of Türkiye. Large cities such as Istanbul, Ankara, and İzmir, as well as provinces like Kocaeli, Antalya, Bursa, Eskişehir, Muğla, Tekirdağ, and Denizli, are shown to have high development levels. However, in provinces like Eskişehir and Denizli, there has been an increase in the number of districts falling into the bottom three tiers according to the 2022 District SEGE index, compared to 2017. Conversely, in provinces such as Mardin, Şırnak, Van, and Muş, there has been a decrease in the number of districts in the bottom three tiers according to the 2022 SEGE index, compared to 2017.

Indices such as the HDI and SEGE serve as essential tools for understanding the socio-economic and human development levels across Türkiye and its districts, offering valuable insights for policy development. These indices provide crucial information for assessing development disparities at both national and local levels. By utilizing the data from these studies, strategic planning and policy-making processes for human and socio-economic development in Türkiye can be more effectively tailored to specific goals. Monitoring progress at district and provincial levels, and incorporating this data into decision-making, can help ensure a more balanced and inclusive approach to development across the country.

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