IDEAS home Printed from https://ideas.repec.org/a/spr/endesu/v25y2023i4d10.1007_s10668-022-02180-2.html
   My bibliography  Save this article

Revisiting and evaluation of the index of sustainable economic welfare based on artificial intelligence: data from 30 Chinese provinces from 2003 to 2019

Author

Listed:
  • Yulin Liu

    (Chongqing University)

  • Xincheng Zhu

    (Chongqing University)

  • Yuhao Wang

    (Chongqing University)

Abstract

As a useful complement to traditional economic indicators, the Index of Sustainable Economic Welfare (ISEW) is best known for its merits in assessing environmental and social costs. Artificial intelligence (AI) is applied in virtually every area of society, the economy, and the environment. Given the significant impact of inequality in the development of AI on economic growth and sustainable economic welfare, we propose an improved ISEW, namely, AI-ISEW. This paper explores the AI-ISEW gap in China and its influencing factors in the context of uneven AI development. We calculate the ISEW and AI-ISEW for 30 provinces in mainland China from 2003 to 2019 and discuss highly controversial methodological assumptions related to income inequality, long-term environmental damage, and nonrenewable energy consumption. The Dagum Gini coefficient is used to reveal regional differences in AI-ISEW, kernel density estimation is used to describe the dynamic evolutionary trend of AI-ISEW development, and quadratic assignment procedure regression is used to explore the factors influencing the AI-ISEW gap. The study found that the AI-ISEW is on the rise, but its growth rate is generally lower than that of GDP. Compared to the AI-ISEW, the ISEW generally overestimates economic welfare. There are regional differences in China’s AI-ISEW, and the main source of differences is interregional differences. Regarding internal differences in each region, the average Gini coefficient from large to small displays the following order: east > west > central > northeast. Adjusted personal consumption is the greatest factor contributing to the AI-ISEW gap. The most economically developed regions have the greatest disparities in welfare. The research reveals the evolutionary trend of China’s sustainable economic welfare from the perspective of AI development and provides evidence for improving the level of economic welfare and accelerating regional coordinated development.

Suggested Citation

  • Yulin Liu & Xincheng Zhu & Yuhao Wang, 2023. "Revisiting and evaluation of the index of sustainable economic welfare based on artificial intelligence: data from 30 Chinese provinces from 2003 to 2019," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(4), pages 3123-3152, April.
    • Handle: RePEc:spr:endesu:v:25:y:2023:i:4:d:10.1007_s10668-022-02180-2
    DOI: 10.1007/s10668-022-02180-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10668-022-02180-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10668-022-02180-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Posner, Stephen M. & Costanza, Robert, 2011. "A summary of ISEW and GPI studies at multiple scales and new estimates for Baltimore City, Baltimore County, and the State of Maryland," Ecological Economics, Elsevier, vol. 70(11), pages 1972-1980, September.
    2. Long, Xianling & Ji, Xi, 2019. "Economic Growth Quality, Environmental Sustainability, and Social Welfare in China - Provincial Assessment Based on Genuine Progress Indicator (GPI)," Ecological Economics, Elsevier, vol. 159(C), pages 157-176.
    3. Howarth, Richard B. & Kennedy, Kevin, 2016. "Economic growth, inequality, and well-being," Ecological Economics, Elsevier, vol. 121(C), pages 231-236.
    4. O'Mahony, Tadhg & Escardó-Serra, Paula & Dufour, Javier, 2018. "Revisiting ISEW Valuation Approaches: The Case of Spain Including the Costs of Energy Depletion and of Climate Change," Ecological Economics, Elsevier, vol. 144(C), pages 292-303.
    5. Walton, Nigel & Nayak, Bhabani Shankar, 2021. "Rethinking of Marxist perspectives on big data, artificial intelligence (AI) and capitalist economic development," Technological Forecasting and Social Change, Elsevier, vol. 166(C).
    6. Hui Jin & Xinyi Qian & Tachia Chin & Hejie Zhang, 2020. "A Global Assessment of Sustainable Development Based on Modification of the Human Development Index via the Entropy Method," Sustainability, MDPI, vol. 12(8), pages 1-20, April.
    7. Stockhammer, Engelbert & Hochreiter, Harald & Obermayr, Bernhard & Steiner, Klaus, 1997. "The index of sustainable economic welfare (ISEW) as an alternative to GDP in measuring economic welfare. The results of the Austrian (revised) ISEW calculation 1955-1992," Ecological Economics, Elsevier, vol. 21(1), pages 19-34, April.
    8. Neumayer, Eric, 2000. "On the methodology of ISEW, GPI and related measures: some constructive suggestions and some doubt on the 'threshold' hypothesis," Ecological Economics, Elsevier, vol. 34(3), pages 347-361, September.
    9. Eisner, Robert, 1988. "Extended Accounts for National Income and Product," Journal of Economic Literature, American Economic Association, vol. 26(4), pages 1611-1684, December.
    10. England, Richard W., 1998. "Measurement of social well-being: alternatives to gross domestic product," Ecological Economics, Elsevier, vol. 25(1), pages 89-103, April.
    11. Pulselli, Federico Maria & Ciampalini, Francesca & Tiezzi, Enzo & Zappia, Carlo, 2006. "The index of sustainable economic welfare (ISEW) for a local authority: A case study in Italy," Ecological Economics, Elsevier, vol. 60(1), pages 271-281, November.
    12. Costanza, Robert & Erickson, Jon & Fligger, Karen & Adams, Alan & Adams, Christian & Altschuler, Ben & Balter, Stephanie & Fisher, Brendan & Hike, Jessica & Kelly, Joe, 2004. "Estimates of the Genuine Progress Indicator (GPI) for Vermont, Chittenden County and Burlington, from 1950 to 2000," Ecological Economics, Elsevier, vol. 51(1-2), pages 139-155, November.
    13. Brent Bleys, 2013. "The Regional Index of Sustainable Economic Welfare for Flanders, Belgium," Sustainability, MDPI, vol. 5(2), pages 1-28, February.
    14. Ashish Dwivedi & Dindayal Agrawal & Ajay Jha & Massimo Gastaldi & Sanjoy Kumar Paul & Idiano D’Adamo, 2021. "Addressing the Challenges to Sustainable Initiatives in Value Chain Flexibility: Implications for Sustainable Development Goals," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 22(2), pages 179-197, December.
    15. Brennan, Andrew John, 2013. "A critique of the perceived solid conceptual foundations of ISEW & GPI — Irving Fisher's cognisance of human-health capital in ‘net psychic income’," Ecological Economics, Elsevier, vol. 88(C), pages 159-166.
    16. Jackson, Tim, 2019. "The Post-growth Challenge: Secular Stagnation, Inequality and the Limits to Growth," Ecological Economics, Elsevier, vol. 156(C), pages 236-246.
    17. Bleys, Brent & Whitby, Alistair, 2015. "Barriers and opportunities for alternative measures of economic welfare," Ecological Economics, Elsevier, vol. 117(C), pages 162-172.
    18. Di Vaio, Assunta & Palladino, Rosa & Hassan, Rohail & Escobar, Octavio, 2020. "Artificial intelligence and business models in the sustainable development goals perspective: A systematic literature review," Journal of Business Research, Elsevier, vol. 121(C), pages 283-314.
    19. Jackson, Tim & Victor, Peter A., 2016. "Does slow growth lead to rising inequality? Some theoretical reflections and numerical simulations," Ecological Economics, Elsevier, vol. 121(C), pages 206-219.
    20. Lawn, Philip A., 2003. "A theoretical foundation to support the Index of Sustainable Economic Welfare (ISEW), Genuine Progress Indicator (GPI), and other related indexes," Ecological Economics, Elsevier, vol. 44(1), pages 105-118, February.
    21. Brennan, Andrew John, 2008. "Theoretical foundations of sustainable economic welfare indicators -- ISEW and political economy of the disembedded system," Ecological Economics, Elsevier, vol. 67(1), pages 1-19, August.
    22. Fu, Buben & Wang, Bin, 2020. "The transition of China's monetary policy regime: Before and after the four trillion RMB stimulus," Economic Modelling, Elsevier, vol. 89(C), pages 273-303.
    23. Talberth, John & Weisdorf, Michael, 2017. "Genuine Progress Indicator 2.0: Pilot Accounts for the US, Maryland, and City of Baltimore 2012–2014," Ecological Economics, Elsevier, vol. 142(C), pages 1-11.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xincheng Zhu & Yulin Liu & Xin Fang, 2022. "Revisiting the Sustainable Economic Welfare Growth in China: Provincial Assessment Based on the ISEW," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 162(1), pages 279-306, July.
    2. Long, Xianling & Ji, Xi, 2019. "Economic Growth Quality, Environmental Sustainability, and Social Welfare in China - Provincial Assessment Based on Genuine Progress Indicator (GPI)," Ecological Economics, Elsevier, vol. 159(C), pages 157-176.
    3. Van der Slycken, Jonas & Bleys, Brent, 2020. "A Conceptual Exploration and Critical Inquiry into the Theoretical Foundation(s) of Economic Welfare Measures," Ecological Economics, Elsevier, vol. 176(C).
    4. Rugani, Benedetto & Marvuglia, Antonino & Pulselli, Federico Maria, 2018. "Predicting Sustainable Economic Welfare – Analysis and perspectives for Luxembourg based on energy policy scenarios," Technological Forecasting and Social Change, Elsevier, vol. 137(C), pages 288-303.
    5. Bleys, Brent & Whitby, Alistair, 2015. "Barriers and opportunities for alternative measures of economic welfare," Ecological Economics, Elsevier, vol. 117(C), pages 162-172.
    6. 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.
    7. Hayashi, Takashi, 2015. "Measuring rural–urban disparity with the Genuine Progress Indicator: A case study in Japan," Ecological Economics, Elsevier, vol. 120(C), pages 260-271.
    8. Menegaki, Angeliki N. & Tugcu, Can Tansel, 2017. "Energy consumption and Sustainable Economic Welfare in G7 countries; A comparison with the conventional nexus," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 892-901.
    9. Beça, Pedro & Santos, Rui, 2010. "Measuring sustainable welfare: A new approach to the ISEW," Ecological Economics, Elsevier, vol. 69(4), pages 810-819, February.
    10. Kubiszewski, Ida & Costanza, Robert & Gorko, Nicole E. & Weisdorf, Michael A. & Carnes, Austin W. & Collins, Cathrine E. & Franco, Carol & Gehres, Lillian R. & Knobloch, Jenna M. & Matson, Gayle E. & , 2015. "Estimates of the Genuine Progress Indicator (GPI) for Oregon from 1960–2010 and recommendations for a comprehensive shareholder's report," Ecological Economics, Elsevier, vol. 119(C), pages 1-7.
    11. Jonas Van der Slycken & Brent Bleys, 2020. "Cost-shifting Versus “Full” Accountability: Dealing with Cross-time and Cross-boundary Issues in the ISEW and GPI. An application to Belgium," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 20/1003, Ghent University, Faculty of Economics and Business Administration.
    12. Posner, Stephen M. & Costanza, Robert, 2011. "A summary of ISEW and GPI studies at multiple scales and new estimates for Baltimore City, Baltimore County, and the State of Maryland," Ecological Economics, Elsevier, vol. 70(11), pages 1972-1980, September.
    13. Günseli BERIK, 2020. "Measuring what matters and guiding policy: An evaluation of the Genuine Progress Indicator," International Labour Review, International Labour Organization, vol. 159(1), pages 71-94, March.
    14. Lazarus, Elias & Brown, Clair, 2022. "Improving the genuine progress indicator to measure comparable net welfare: U.S. and California, 1995–2017," Ecological Economics, Elsevier, vol. 202(C).
    15. Jonas Slycken & Brent Bleys, 2023. "Towards ISEW and GPI 2.0: Dealing with Cross-Time and Cross-Boundary Issues in a Case Study for Belgium," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 168(1), pages 557-583, August.
    16. Jonas Van der Slycken & Brent Bleys, 2021. "Towards ISEW and GPI 2.0, part I: developing two alternative measures of economic welfare with distinct time and boundary perspectives for Belgium," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 21/1026, Ghent University, Faculty of Economics and Business Administration.
    17. Armiento, Mirko, 2018. "The Sustainable Welfare Index: Towards a Threshold Effect for Italy," Ecological Economics, Elsevier, vol. 152(C), pages 296-309.
    18. Luhua Wu & Shijie Wang & Xiaoyong Bai & Guangjie Luo & Jinfeng Wang & Fei Chen & Chaojun Li & Chen Ran & Sirui Zhang, 2022. "Accelerating the Improvement of Human Well-Being in China through Economic Growth and Policy Adjustment," IJERPH, MDPI, vol. 19(19), pages 1-20, October.
    19. Mirko Armiento, 2016. "The Sustainable Welfare Index for Italy, 1960-2013," Working Papers 1601, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2016.
    20. Fox, Mairi-Jane V. & Erickson, Jon D., 2018. "Genuine Economic Progress in the United States: A Fifty State Study and Comparative Assessment," Ecological Economics, Elsevier, vol. 147(C), pages 29-35.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:endesu:v:25:y:2023:i:4:d:10.1007_s10668-022-02180-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.