Author(s)

F. Ciampalini, R. Ridolfi, F. M. Pulselli & N. Marchettini

Abstract

This paper presents a time series analysis of the Index of Sustainable Economic Welfare (ISEW). It is a measure, alternative to GDP, that in accordance with the principles of sustainability takes into consideration environmental and social aspects within the traditional economic accounting system. The Index is calculated for an Italian Province from 1971 to 2003 and it will be compared with the provincial GDP during the same period. A growing gap between the two monetary values (GPI grows faster then ISEW) has been occurring consistently with the national trend. This means that part of the wealth which GDP asserts does not correspond to welfare. The ISEW monetizes this gap in order to orient decisions for a more sustainable way of life and more correct policies. Keywords: GDP, ISEW, welfare, sustainability, ecological economics. 1 Introduction This paper represents one of the many examples, in this case an ecological economics initiative, where it’s possible to find a political planning where economy and ecology speak the same language and rely on the research and university for building their future society in which the unique development to wish is the sustainable one. Ecological Economics offers this potential because it is built around a more complex understanding of human society that transcends the traditional economic vision [1]. The economic system is an open subsystem of a larger but finite and nongrowing ecosystem; so no infinite economic growth is possible in a finite world. Society is nowadays moving from a relatively empty world to a relatively full world, and an exclusive emphasis on economic growth could produce serious, and possibly irreversible, ecological damages.

Keywords

GDP, ISEW, welfare, sustainability, ecological economics.