Unlike the United Nations’ Human Development Index (HDI), the LQI is derived rigorously from the economics of human welfare.</ref> Like the HDI it can be used to rank nations in order of human welfare (development, quality of life). However, more important and unlike the HDI, it can also serve as an objective function to be used in setting national or corporate goals for managing risk and to guide effective allocation of society’s scarce resources for the mitigation of risks to life or health. The LQI is a summary indicator of net benefit to society for improving the overall public welfare by reducing risks to life in a cost-effective manner (Lind et al. 1992).