Can NNP be used for welfare comparisons?

- By:

Courtesy of Cambridge University

This paper contains a critical assessment of the claim that NNP can be used for welfare comparisons. The analysis assumes that national accounts are comprehensive (in particular ‘greened’ by taking into account environmental amenities and natural resource depletion), but does not assume optimal resource allocation. The general conclusion is that greaterNNPcorresponds towelfare enhancement only if net investment flows are revalued. Real utility-NNP and real measurable NNP made comparable across time by means of a consumer price index allow for such revaluation, and thus indicate welfare improvement.

Customer comments

No comments were found for Can NNP be used for welfare comparisons?. Be the first to comment!