The Physical Quality of Life Index is described as a better indicator of:

1. National income is treated as an indicator of economic wellbeing, with progress measured by GDP per capita and its growth rate. 2. The textbook then argues that a rise in GDP or per capita income need not always promote welfare, giving reasons such as a greater share of capital goods, environmental hazards and the production of war goods. 3. It therefore presents the Physical Quality of Life Index as a better indicator of economic welfare. 4. Its three components are standard of living, life expectancy at birth and literacy. 5. The book's own exercise keys this to welfare rather than to growth or development, which are the deliberate near-miss distractors. _Source: TN HSC Class 12 Economics (Samacheer Kalvi, Govt of Tamil Nadu), Ch 2 "National Income", §2.8.2_