There are many ways to measure the literacy rates of a nation. In order to compare nations, however, a standard such as the Adult Literacy Index is helpful for determining the social welfare of the people from country to country. By looking at the ALI, nations and philanthropies can decide where their money -- and their time -- may be needed most.

The Adult Literacy Index

The Adult Literacy Index, created in 1990 by the United Nations in the hopes of dramatically raising literacy rates by the end of the 20th century, measures the literacy rates for each country's population. According to the World Bank, the ALI is calculated first by determining the number of people who are literate in the country, and then dividing the number of literates, who are aged 15 years and over, by their population and multiplying the result by 100. In order to compute ALI, the data is broken into three groups: the number of adults in a country who have completed elementary school, the number of adults ages 15 to 24 who are literate, and the number of adults over 24 years old who are literate.

What Kind of Literacy is Measured by the ALI?

The World Bank states that the ALI is the percentage of the population in a country aged 15 and above who can read and write a short, statement on their everyday lives. Generally, according to the UN, literacy questions are asked during the census period, when an individual is asked to complete a household survey. In some countries, obtaining information through a household survey may be difficult, and the figures for each country may be a bit out of date, as most countries do not conduct a yearly census.

The ALI measures simple literacy skills, but it also measures numeracy -- which for the ALI means that an adult is able to add and subtract numbers successfully. The United Nations also compares the literacy rates of one country to other countries in different economic groups: low, middle and high income.

The ALI as Part of the Larger Human Development Index

The ALI is a part of another index created in 1990 by the United Nations -- the Human Development Index. The HDI uses the ALI with other figures to measure the overall growth and development of living standards when compared to other countries. The HDI uses information to compute the average such as income, nutrition and health of people living in the country and access to health-care services, personal security, available leisure hours, political and cultural freedom and participation in the activities of a community.

Uses of the ALI

The United Nations uses the ALI to compare the literacy rate of adults with other countries, and to make decisions about where aid money may be needed the most. The ALI, according to the World Bank, is also used to chart the increases or decreases of literacy rates over time. For example, in its 2013 report, the UN discussed the rise in the literacy rates and the Human Development index in many countries like China, India, Brazil and South Africa.