GREEN NET NATIONAL PRODUCT:
AN OVERVIEW OF THE CAPITAL BASIS OF SUSTAINABLE DEVELOPMENT
Meneviş ÖĞÜT (Ege University)
R.Funda BARBAROS (Ege University)
Sustainable development is a much disputable concept but a fairly non-contentious
definition could be that it is a process that rises the per capita well being,
coupled with reductions in poverty and inequity, together with the requirement
that 'resource base' should not be depleted. Sustainable development now figures
as a goal in dozens of national environmental and development policy statements.
One very important point before policies can be formulated is finding indicators
to measure sustainable development.
The focus of this paper is on the issue of 'measuring sustainability in a macroeconomic
context' to see if the development path is sustainable. The critical concepts
analysed are 'Green Net National Product' (gNNP) and 'genuine (green) savings'
(Sg). gNNP; is defined as the maximum level of consumption that can be enjoyed
without running the stocks of the capital assets. Sg; refers to that level of
saving over and above the sum of all the capital deprecations in the economy.
Hence it is equal to difference between gNNP and consumption.
For this purpose we define sustainable development in terms of non-declining
per capita well being overtime. The necessary condition for achieving a sustainable
development path is then defined as per capita stock of capital assets should
themselves be non-declining because the ability of a society to improve its
wellbeing is determined by the quality and quantity of capital assets available.
According to Pearce and Atkinson; the level of Sg determines whether the capital
asset are non-declining: Intuitively if Sg >0 any nation must be adding to its
capital base. If Sg<0 then the nation is running down its capital stocks; not
following a sustainable development path.
Although measurement of sustainable development is open to much dispute gNNP
and Sg measurements have been done for various countries successfully. The aim
of this paper is to construct an approach for Turkey's gNNP in the light of
the above country experiments
