Testing for long-run "sustainability": Genuine Savings estimates for Britain, 1760-2000

Citation

McLaughlin E, Greasley D, Hanley N, Oxley L & Warde P (2012) Testing for long-run "sustainability": Genuine Savings estimates for Britain, 1760-2000. Stirling Economics Discussion Paper, 2012-05.

Abstract
Genuine Savings has been proposed as an economic indicator of sustainable development, and has been the focus of World Bank sustainability assessments for countries globally. However, whilst the theoretical basis for Genuine Savings is well-established (Arrow et al, 2011; Hamilton and Withagen, 2007; Pezzey, 2004), its ability to forecast long-run trends in well-being remains un-tested. In this paper, we take a first step towards such an assessment by constructing a time series of estimates for produced, natural and human capital for Britain over the period 1760-2000, and use them to derive estimates of Genuine Savings. The next step in the project will be to compare these Genuine Savings estimates with a range of well-being indicators to answer the question: does positive Genuine Savings predict improvements in average well-being?

Keywords
Genuine Savings; Sustainability; Economic History; Britain;

JEL codes

• Q01: Sustainable Development
• Q32: Exhaustible Resources and Economic Development
• Q56: Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
• N13: Economic History: Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations: Europe: Pre-1913
• N14: Economic History: Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations: Europe: 1913-