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The Index of Sustainable Economic Welfare (ISEW) for a Local Authority: A Case Study in Italy

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  • Federico Maria Pulselli
  • Francesca Ciampalini
  • Enzo Tiezzi
  • Carlo Zappia

    ()

Abstract

The Index of Sustainable Economic Welfare (ISEW) has been calculated for many countries, but rarely at the local level. This paper shows how the index has been calculated for the Province of Siena, Central Italy. The whole procedure is illustrated step by step, including the search for the most suitable and precise methods to obtain reliable values for each item composing the index. Application of ISEW at a very local level was found to be feasible. The most general difficulty encountered was the lack of an adequate institutionalised source of statistical information to support the construction of indicators other than purely economic or demographic ones. The availability of data depends on the interest in implementing projects of sustainable management of natural resources and land on the part of local authorities and their consequent willingness to invest money and human resources on such projects. The ISEW is a good tool for local environmental policy, because it gives a more realistic representation of the well-being of the population than GDP, since it includes environmental and social items not considered in conventional national accounting. Furthermore, in Italy, the principle of administrative decentralization has been implemented in recent years to such an extent that the central government devolved part of its power to Regions, Provinces and Municipalities. Arguably, local authorities should therefore allocate more resources to pursue their policies towards sustainability, an issue which modern electoral campaigns are often based on. The results for the Province of Siena show that there is a large gap between local GDP and ISEW (about 37% of GDP).

Suggested Citation

  • Federico Maria Pulselli & Francesca Ciampalini & Enzo Tiezzi & Carlo Zappia, 2005. "The Index of Sustainable Economic Welfare (ISEW) for a Local Authority: A Case Study in Italy," Department of Economics University of Siena 449, Department of Economics, University of Siena.
  • Handle: RePEc:usi:wpaper:449
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    Cited by:

    1. Boris Korobitsyn, 2015. "Methodological Approaches for Estimating Gross Regional Product after Taking into Account Depletion of Natural Resources, Environmental Pollution and Human Capital Aspects," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(3), pages 77-88.
    2. Berloffa, Gabriella & Modena, Francesca, 2012. "Economic well-being in Italy: The role of income insecurity and intergenerational inequality," Journal of Economic Behavior & Organization, Elsevier, vol. 81(3), pages 751-765.
    3. Maria Cracolici & Miranda Cuffaro & Peter Nijkamp, 2010. "The Measurement of Economic, Social and Environmental Performance of Countries: A Novel Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 95(2), pages 339-356, January.
    4. Maria Francesca Cracolici & Miranda Cuffaro & Peter Nijkamp, 2008. "Analysis of Spatial Disparities by a Structural Equations Model," Tinbergen Institute Discussion Papers 08-058/3, Tinbergen Institute.
    5. 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.
    6. Jorge Garcés Ferrer & Francisco Ródenas Rigla & Carla Vidal Figueroa, 2016. "Application of Social Policy Index (SPI) Amended in Three OECD Countries: Finland, Spain and Mexico," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 127(2), pages 529-539, June.
    7. repec:eee:ecoser:v:30:y:2018:i:pb:p:248-256 is not listed on IDEAS
    8. Bleys, Brent & Whitby, Alistair, 2015. "Barriers and opportunities for alternative measures of economic welfare," Ecological Economics, Elsevier, vol. 117(C), pages 162-172.
    9. Angelica-Nicoleta NECULĂESEI, 2015. "About Welfare In Cultural Context," SEA - Practical Application of Science, Fundația Română pentru Inteligența Afacerii, Editorial Department, issue 7, pages 407-414, April.
    10. repec:eee:ecolec:v:143:y:2018:i:c:p:105-110 is not listed on IDEAS
    11. Brent Bleys, 2013. "The Regional Index of Sustainable Economic Welfare for Flanders, Belgium," Sustainability, MDPI, Open Access Journal, vol. 5(2), pages 1-28, February.
    12. 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.
    13. repec:gam:jecomi:v:6:y:2018:i:2:p:24-:d:139333 is not listed on IDEAS
    14. Pernille Christensen, 2011. "Assessing Assessment: Toward a More Holistic Rating System for Sustainability Performance," ERES eres2011_336, European Real Estate Society (ERES).
    15. 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.
    16. Pulselli, Federico M. & Bravi, Mirko & Tiezzi, Enzo, 2012. "Application and use of the ISEW for assessing the sustainability of a regional system: A case study in Italy," Journal of Economic Behavior & Organization, Elsevier, vol. 81(3), pages 766-778.
    17. G. Madonia & M. Cracolici & M. Cuffaro, 2013. "Exploring Wider Well-Being in the EU-15 Countries: An Empirical Application of the Stiglitz Report," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 111(1), pages 117-140, March.
    18. repec:eee:soceps:v:62:y:2018:i:c:p:56-74 is not listed on IDEAS

    More about this item

    Keywords

    Local level; economic welfare; sustainability; ISEW; economic policy;

    JEL classification:

    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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