‘Quality of life index is a composite criterion consisting of certain selected social indicators to measure the standard of living (welfare) of the people’.
National income and per capita income as the indicators of development have many limitations.
So economists have tried to measure development in terms of social indicators which emphasize the quality of life instead of quantitative aspect emphasized by GNP or GNP per capita.
These include availability of food and nutrition to the people, health care facilities, level of literacy and education, environment, work leisure ratio and conditions of work etc.
It is not possible to include all the determinants of welfare in the constructions of quality of life index because many of these variables involve value judgements. It is therefore said that certain selected social indicators be combined together with due weight assigned to determine the quality of life index.
Thus, quality of life index is a composite criterion consisting of certain selected social indicators to measure the standard of living (welfare) of the people. D. Morris uses only three items to construct a “Physical Quality of Life Index” (PQLI) relating to 23 developed and developing countries of the world for a comparative study.
These indicators are:
(i) Life Expectancy at birth
(ii) Infant mortality rate
(iii) Literacy rate
After normalising these three indicators Morris suggested to take a simple arithmetic mean of the three indicators to construct what is called the Physical Quality of Life Index (PQLI). Similarly Human Development Index (HDI) has been prepared under United National Development Programme which is an attempt to measure the quality of life.
Quality of Life Index (QLI) as an indicator of development has several limitations as noted below :
1. There is no unanimity among economists as to the number and types of items to be included in such an index.
2. The majority of indicators are inputs and not output such as education, health etc.
3. Social indicators are concerned with current welfare and are not related to the future.
4. There is the problem of assigning weights to the various items which may depend upon the social, economic and political set up of the country. Many of the social indicators are subjective in character and differ from country to country Morris assigns equal weights to all the three indicators which undermine the value of the index in a comparative analysis of various countries. If each country chooses its own list of social indicators and assigns weights to them, their international comparison would be inaccurate.