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Measures of sustainability and evolving relation with variation in depletion of natural resources

Author: 
Swati Sinha Babu and Soumyendra Kishore Datta
Subject Area: 
Social Sciences and Humanities
Abstract: 

The immense emphasis given to economic growth has shifted in the last two decades to concerns with sustainable development. A development path is considered to be sustainable if it ensures that the stock of overall natural capital remains constant or increases over time. The new advances in the field of accounting theory renewed the importance of ‘greening’ the national income accounts. That is, the depreciation or depletion of natural capital should be included in any aggregate indicators of net national output. This led to the evolution of the concept of Environmentally Adjusted Net National Product (eaNNP) which takes account of an economy’s national product after adjusting for environmental aspects and Adjusted Net Savings (ANS) as a comprehensive measure of a country’s rate of saving after accounting for investments in human capital, depreciation of produced assets, and depletion and degradation of the environment. The objective of this article is to establish the connection between ANS and eaNNP as well as analyse the simultaneity hypothesis across variation in ANS and several other depleted natural resources.

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