Capability approach

Indian Economy glossary

Topic: Measuring Development: Income, HDI and Sustainability · NCERT: Beyond NCERT

Meaning

The capability approach is Amartya Sen's way of judging development. It asks how far people's real freedoms have grown to live the lives they value, not just how much income they have. It uses two terms:

  • Functionings: what a person actually is or does, such as being nourished or being literate.
  • Capabilities: the set of functionings a person can choose from.

Sen set out the idea in Development as Freedom (1999). It shaped UNDP's Human Development Index.

Example

In 2023-24, Kerala's per capita income (₹2,81,001) was below Haryana's (₹3,25,759). Yet its IMR was 6 against Haryana's 28 (2020). Its literacy was 94% against 82% (2017-18). By the capability yardstick, people in Kerala have more real freedom to live long and learn, even with less income.

Don't confuse with

  • Human capital: this treats health and education as a means to raise labour productivity. The capability approach treats them as ends in themselves.

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