Public release date: 28-Mar-2012
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Contact: Terry Collins
Earth System Science Partnership
Beyond GDP: Experts preview ‘Inclusive Wealth’ index at Planet under Pressure conference
Needed to surmount sustainability hurdles: New yardstick of national progress; reforms of corporate reporting; an overhaul of environmental institutions
IMAGE: This graph illustrates the calculation of inclusive wealth for Brazil.
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Brazil and India pay a high price for rapid economic growth, according to experts speaking at a major international meeting in London, Planet Under Pressure.
Between 1990 and 2008, the wealth of these two countries as measured by GDP per capita rose 34% and 120% respectively. But a myopic focus on economic capital is flawed, scientists and economists at the conference argue. Natural capital, the sum of a country’s assets, from forests to fossil fuels and minerals, declined 46% in Brazil and 31% in India, according to a new “Inclusive Wealth Indicator” designed to augment GDP as a measure of economic progress.
When measures of natural, human and manufactured capital are considered together to obtain a more comprehensive value, Brazil’s “Inclusive Wealth” rose just 3% and India’s rose 9% over that time.
“The work on Brazil and India illustrates why Gross Domestic Product is inadequate and misleading as an index of economic progress from a long-term perspective,” says Professor Anantha Duraiappah, Executive Director of UNU-IHDP.