unit of measurement so that we can combine them at a later stage.

So how do we do that?

This process is called a normalization process.

And the normalization that is chosen or

that is used in the construction of the HDI is as follows.

So you take for, so the index, the normalized index if you want is given by

the value of the indicator minus a minimum value divided by maximum minus minimum.

So what are these maximum and minimum values, or where are they coming from?

So for each indicator, we need to set minimum and a maximum.

So what is this minimum?

The minimum is that level of achievement at which or

below which the country is supposed to be at zero level of achievement.

And the maximum is that level of achievement at which, or

above which, the country is supposed to be at a maximum,

having attained the maximum level of achievement.

So let's take life expectancy for example.

The minimum and maximum have been set at 20 and 85 respectively.

So if a country is at level of 20 or

below 20, then it hasn't had any achievement in this dimension, so

the achievement will be zero.

And if for a countries at 85 or above 85, it considered to have achieved

the maximum level of achievement for this indicator, so that'll be one.

So this normalization process basically what is does is to project

the value onto a scale, a zero one scale.

So maximum achievement being set at one, and

the minimum achievement set at zero for the normalized value.

For the mean years of schooling, this maximum is set.

There are natural minimum and maximum possible for these indicators.

For example, years of schooling, obviously the minimum is zero and

the maximum is set at 15 for the mean years of schooling.

Which is the years of schooling, average years of schooling of

the adult population as I said, let's say of the older generation.

And the expected years of schooling has a minimum also at zero but

a maximum of 18 because is the years of schooling

supposed to reflect the years of schooling of a younger population.

Who are normally, if you go in overtime, we expect that

the younger generations have higher levels of education than the older generations.

And the last indicator, per capita income, the minimum is set at $100 PPP,

and the maximum at $75,000 PPP dollars.

These are the major steps involved in the construction of a multi dimensional index.

Now let's see how this normalization works and

what is the meaning of this normalization.

So we set for each indicator, we set a minimum and a maximum.

So let's say the minimum is here and the maximum is here.

So remember that this is a level of achievement at which or

below which the country is supposed to be at a zero level of achievement,

zero level for the index normalized value.

And the maximum value is that level at which are above it,

the country is at a level of one maximum achievement.

Now, so this is the maximum possible achievement for any country.