Towards ISEW and GPI 2.0: Dealing with Cross-Time and Cross-Boundary Issues in a Case Study for Belgium

Jonas Slycken () and Brent Bleys
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Jonas Slycken: Ghent University

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, 2023, vol. 168, issue 1, No 21, 557-583

Abstract: Abstract Scholars have long had difficulties when dealing with cross-time and cross-boundary issues in the Index of Sustainable Economic Welfare (ISEW) and Genuine Progress Indicator (GPI). This case study for Belgium is the very first that tackles these complexities by calculating two ISEW-variants with distinct time and boundary perspectives that are based on Fisherian or Hicksian income. Experiential welfare looks at what is currently experienced within domestic borders, whereas the benefits and costs of present activities also include the welfare impacts shifted in time and space. The former construct only registers present ecological costs within borders and does not include capital changes, while the latter includes capital changes and ecological cost-shifting. As we find substantial ecological cost-shifting, we suggest to move forward with the latter concept. Next, the paper introduces a number of advances to the ISEW-methodology. These include the introduction of a sufficiency threshold for consumption expenditures when accounting for the diminishing marginal utility of income, the adoption of a consumption footprint view for the emissions embodied in trade with an additional focus on the climate impacts of aviation and shipping and the inclusion of the shadow economy. Finally, we propose to look beyond the aggregate ISEW and adopt a disaggregated approach to evaluate economic performance in detail.

Keywords: Index of sustainable economic welfare (ISEW); Genuine progress indicator (GPI); Cost-shifting; Beyond GDP; Postgrowth; Degrowth (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s11205-023-03142-5

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