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A Critique of the Environmental Sustainability Index


  • Raghbendra Jha


  • K.V. Bhanu Murthy


The Environmental Sustainability Index (ESI) has been proposed by collaboration of the World Economic Forum, Geneva, Center for International Earth Science Information Network, Columbia University, and Yale Center for Environmental Law and Policy, New Haven as a measure of the overall state of the environment. This paper argues that the basic design of the ESI leaves much to be desired. It has conceptual problems in its visualization of environmental degradation and sustainability. The choice of variables as well as the statistical methodology of compiling the index is also found to be wanting. The paper then proposes an alternative methodology using Principal Components Analysis and argues that this is an improvement upon the ESI methodology. Given the likely use of aggregate environmental indexes in future environmental management, the critique advanced in this paper is of considerable significance.

Suggested Citation

  • Raghbendra Jha & K.V. Bhanu Murthy, 2003. "A Critique of the Environmental Sustainability Index," Departmental Working Papers 2003-08, The Australian National University, Arndt-Corden Department of Economics.
  • Handle: RePEc:pas:papers:2003-08

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    References listed on IDEAS

    1. Jha, Raghbendra & Murthy, K. V. Bhanu, 2003. "An inverse global environmental Kuznets curve," Journal of Comparative Economics, Elsevier, vol. 31(2), pages 352-368, June.
    2. Wolfgang Keller & Arik Levinson, 2000. "Environmental Regulations and FDI Inflows to U.S. States," Working Papers gueconwpa~00-00-06, Georgetown University, Department of Economics.
    3. William T. Harbaugh & Arik Levinson & David Molloy Wilson, 2002. "Reexamining The Empirical Evidence For An Environmental Kuznets Curve," The Review of Economics and Statistics, MIT Press, vol. 84(3), pages 541-551, August.
    4. Heidi Gjertsen & HChristopher B. Barrett, 2004. "Context-Dependent Biodiversity Conservation Management Regimes: Theory and Simulation," Land Economics, University of Wisconsin Press, vol. 80(3), pages 321-339.
    5. Jeffrey A. Frankel & Andrew K. Rose, 2005. "Is Trade Good or Bad for the Environment? Sorting Out the Causality," The Review of Economics and Statistics, MIT Press, vol. 87(1), pages 85-91, February.
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    Cited by:

    1. Philipp Babcicky, 2013. "Rethinking the Foundations of Sustainability Measurement: The Limitations of the Environmental Sustainability Index (ESI)," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 113(1), pages 133-157, August.
    2. A. Bühn & M.R. Farzanega, 2011. "Hold Your Breath: A New Index of Air Quality," Working Papers 11-24, Utrecht School of Economics.
    3. Suhejla Hoti & Michael McAleer & Laurent L. Pauwels, 2004. "Modelling Environmental Risk," IHEID Working Papers 08-2004, Economics Section, The Graduate Institute of International Studies.
    4. Buehn, Andreas & Farzanegan, Mohammad Reza, 2013. "Hold your breath: A new index of air pollution," Energy Economics, Elsevier, vol. 37(C), pages 104-113.
    5. J. Andres Dominguez & Teresa Noronha Vaz, 2011. "Contrasts in the governance structures in the transborder regions Andaluzia -Algarve," ERSA conference papers ersa10p1121, European Regional Science Association.
    6. Bhanu Murthy, K.V., 2007. "Social responsibility standards and global environmental accountability : a developing country perspective," MPRA Paper 2636, University Library of Munich, Germany.
    7. Siche, J.R. & Agostinho, F. & Ortega, E. & Romeiro, A., 2008. "Sustainability of nations by indices: Comparative study between environmental sustainability index, ecological footprint and the emergy performance indices," Ecological Economics, Elsevier, vol. 66(4), pages 628-637, July.

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    Environmental sustainability; Principal Components Analysis;

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