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Are Economic Growth and Sustainable Development Converging? Evidence from the Comparable Genuine Progress Indicator for Organisation for Economic Co-operation and Development Countries

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  • Daniel Francisco Pais

    (Department of Management and Economics, University of Beira Interior, Portugal,)

  • Tiago Lopes Afonso

    (Department of Management and Economics, University of Beira Interior, Portugal,)

  • Ant nio Cardoso Marques

    (Department of Management and Economics, University of Beira Interior, Portugal,)

  • Jos A Fuinhas

    (Faculty of Economics, University of Coimbra, Portugal.)

Abstract

Academic literature has reflected increasing concerns about the trade-off between preserving the environment and economic growth. To address these concerns, new measurements are needed to evaluate sustainable development, given the limitations of Gross Domestic Product (GDP) in quantifying welfare and sustainability. Genuine Progress Indicator (GPI) is one of those alternative measurements. This paper assesses sustainable development for 28 OECD countries by computing a comparable GPI. Two different approaches to economic growth and sustainable development are discussed. Results suggest that the richest countries are not always the most sustainable. Furthermore, the effect of the financial crisis is verified immediately in the GDP, in contrast to the lagged effect observed in the GPI. Additionally, measures that promote economic growth may not improve sustainability, and may even negatively affect it. Consequently, alternative indicators such as the CGPI can obtain more valuable information for policy-makers seeking to achieve both economic growth and sustainable development.

Suggested Citation

  • Daniel Francisco Pais & Tiago Lopes Afonso & Ant nio Cardoso Marques & Jos A Fuinhas, 2019. "Are Economic Growth and Sustainable Development Converging? Evidence from the Comparable Genuine Progress Indicator for Organisation for Economic Co-operation and Development Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 9(4), pages 202-213.
    • Handle: RePEc:eco:journ2:2019-04-26
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    3. Jonas Van der Slycken & Brent Bleys, 2021. "Towards ISEW and GPI 2.0, part II: Is Europe faring well with growth? Evidence from a welfare comparison in the EU-15 from 1995 to 2018," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 21/1027, Ghent University, Faculty of Economics and Business Administration.
    4. Cook, David & Kaji, Takeshi Benjamín & Davíðsdóttir, Brynhildur, 2023. "An assessment of the scope and comprehensiveness of well-being economy indicator sets: The cases of Iceland, Scotland and New Zealand," Ecological Economics, Elsevier, vol. 205(C).
    5. Pierluigi Morano & Francesco Tajani & Maria Rosaria Guarini & Francesco Sica, 2021. "A Systematic Review of the Existing Literature for the Evaluation of Sustainable Urban Projects," Sustainability, MDPI, vol. 13(9), pages 1-17, April.
    6. Francesco Sica & Francesco Tajani & Maria Rosaria Guarini & Rossana Ranieri, 2023. "A Sensitivity Index to Perform the Territorial Sustainability in Uncertain Decision-Making Conditions," Land, MDPI, vol. 12(2), pages 1-21, February.
    7. Cook, David & Malinauskaite, Laura & Davíðsdóttir, Brynhildur & Ögmundardóttir, Helga, 2022. "Capital assets underpinning economic well-being – The example of whale ecosystem services in Arctic coastal communities," Ecosystem Services, Elsevier, vol. 55(C).
    8. Arno J. van Niekerk, 2020. "Inclusive Economic Sustainability: SDGs and Global Inequality," Sustainability, MDPI, vol. 12(13), pages 1-19, July.

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    More about this item

    Keywords

    CGPI; sustainable development; economic growth;
    All these keywords.

    JEL classification:

    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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