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Progress along the path: evolving issues in the measurement of genuine saving

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Abstract

More than 10 years since a practical linkage between sustainable development and a measure of national wealth—expanded to include natural and environmental resources—was first posited, the empirical estimation of adjusted net savings, dubbed ‘genuine’ saving, has evolved considerably. In this paper we take stock of both progress achieved and the challenges that remain. We begin by recalling the key points made in Pearce and Atkinson (1993, Ecol Econ 8, 103), which presented the first cross-country estimates of savings rates adjusted to reflect depletion and degradation of the environment. We then briefly summarise the evolution of the theoretical argument linking savings and sustainability. However, the main focus of this paper is an aspect that concerned David Pearce greatly, namely the evolution of the measurement of genuine savings. We identify and consider the empirical evidence with regard to two particular measurement issues: the valuation of exhaustible resources and environmental degradation. Common to the both issues are concerns about measuring changes in national wealth in real world economies.

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Authors and Affiliations

  1. Department of Geography and Environment and Centre for Environmental Policy and Governance (CEPG), London School of Economics and Political Science, Houghton Street, London, WC2A 2AE, UK

    Giles Atkinson

  2. Environment Department, The World Bank, 1818 H-Street, N.W. Washington, DC, 20433, USA

    Kirk Hamilton

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  1. Giles Atkinson
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  2. Kirk Hamilton
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Correspondence to Giles Atkinson.

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Atkinson, G., Hamilton, K. Progress along the path: evolving issues in the measurement of genuine saving. Environ Resource Econ 37, 43–61 (2007). https://doi.org/10.1007/s10640-007-9114-7

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