A Simple Numerical Study on Sustainable Development with Genuine Saving

Masayuki Sato, Sovannroeun SAMRETH and Katsunori Yamada ()

ISER Discussion Paper from Institute of Social and Economic Research, Osaka University

Abstract: This paper presents a numerical examination of sustainability using a World Bank dataset. Unlike previously used criteria of sustainability which focused on past performance of the genuine saving (GS) indicator, here we consider future sustainability by simulating a future stream of GS in a Monte-Carlo fashion. Even in the case that the historical average GS of a country is non-negative, the possibility remains that it could become negative in the future depending on its time series path. We show that certain countries classified by previous studies as being sustainable are, in fact, not sustainable. On the basis of our results, policy makers will be able to see circumstantially which components should be their policy targets.

Date: 2008-12, Revised 2009-07

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Persistent link: http://EconPapers.repec.org/RePEc:dpr:wpaper:0728

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