Beyond GDP: The Wealth Perspective of Sustainability
The capital approach, or the wealth economy framework of sustainability broadens the conventional measure of economic performance “beyond GDP”, with a long-term view. The totality of capital assets, or wealth, is composed of produced, human, natural and social capital, and is seen as the source of...
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| Format: | Article |
| Language: | English |
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Corvinus University of Budapest
2023-12-01
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| Series: | Köz-gazdaság |
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| Online Access: | https://retp.eu/index.php/retp/article/view/1521 |
| _version_ | 1797376686554087424 |
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| author | Antal Ferenc Kovács |
| author_facet | Antal Ferenc Kovács |
| author_sort | Antal Ferenc Kovács |
| collection | DOAJ |
| description |
The capital approach, or the wealth economy framework of sustainability broadens the conventional measure of economic performance “beyond GDP”, with a long-term view. The totality of capital assets, or wealth, is composed of produced, human, natural and social capital, and is seen as the source of income, benefits, and wellbeing of present and future generations. Shrinkage in this production base signals unsustainable development. While the weak criterion of sustainability allows substitution between all capital elements, the strong criterion does not allow reductions in the renewable component of natural capital. Using World Bank data, we found that during the 1995-2018 period, 14% and 58% of the countries globally did not meet the weak and the strong criteria of sustainability, respectively. Also, a comparative analysis of wealth and its components is provided for selected OECD countries. It is found that human capital is proportionally the most significant among the capital elements, followed by produced capital. Natural capital, both renewable and non-renewable, lags far behind. Our findings raise questions regarding the rationale of economic convergence, as well as confirm the necessity of further methodological improvements regarding data generation and statistics, including the valuation of assets.
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| first_indexed | 2024-03-08T19:42:17Z |
| format | Article |
| id | doaj.art-34e659863abf4087bc888da92c10a07e |
| institution | Directory Open Access Journal |
| issn | 1788-0696 |
| language | English |
| last_indexed | 2024-03-08T19:42:17Z |
| publishDate | 2023-12-01 |
| publisher | Corvinus University of Budapest |
| record_format | Article |
| series | Köz-gazdaság |
| spelling | doaj.art-34e659863abf4087bc888da92c10a07e2023-12-24T14:23:16ZengCorvinus University of BudapestKöz-gazdaság1788-06962023-12-0118410.14267/RETP2023.04.06Beyond GDP: The Wealth Perspective of SustainabilityAntal Ferenc Kovács0John von Neumann University, Assistant Lecturer The capital approach, or the wealth economy framework of sustainability broadens the conventional measure of economic performance “beyond GDP”, with a long-term view. The totality of capital assets, or wealth, is composed of produced, human, natural and social capital, and is seen as the source of income, benefits, and wellbeing of present and future generations. Shrinkage in this production base signals unsustainable development. While the weak criterion of sustainability allows substitution between all capital elements, the strong criterion does not allow reductions in the renewable component of natural capital. Using World Bank data, we found that during the 1995-2018 period, 14% and 58% of the countries globally did not meet the weak and the strong criteria of sustainability, respectively. Also, a comparative analysis of wealth and its components is provided for selected OECD countries. It is found that human capital is proportionally the most significant among the capital elements, followed by produced capital. Natural capital, both renewable and non-renewable, lags far behind. Our findings raise questions regarding the rationale of economic convergence, as well as confirm the necessity of further methodological improvements regarding data generation and statistics, including the valuation of assets. https://retp.eu/index.php/retp/article/view/1521Sustainabilitywealth economywellbeingQ01Q51Q56 |
| spellingShingle | Antal Ferenc Kovács Beyond GDP: The Wealth Perspective of Sustainability Köz-gazdaság Sustainability wealth economy wellbeing Q01 Q51 Q56 |
| title | Beyond GDP: The Wealth Perspective of Sustainability |
| title_full | Beyond GDP: The Wealth Perspective of Sustainability |
| title_fullStr | Beyond GDP: The Wealth Perspective of Sustainability |
| title_full_unstemmed | Beyond GDP: The Wealth Perspective of Sustainability |
| title_short | Beyond GDP: The Wealth Perspective of Sustainability |
| title_sort | beyond gdp the wealth perspective of sustainability |
| topic | Sustainability wealth economy wellbeing Q01 Q51 Q56 |
| url | https://retp.eu/index.php/retp/article/view/1521 |
| work_keys_str_mv | AT antalferenckovacs beyondgdpthewealthperspectiveofsustainability |