Green Gross Domestic Product

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Green Gross Domestic Product (Green GDP) is an index of economic growth with the environmental consequences of that growth factored in.

In 2004, Wen Jiabao, the Chinese premier, announced that the green GDP index would replace the Chinese GDP index itself as a performance measure for government and party officials at the highest levels.

As an experiment in national accounting, the Green GDP effort collapsed in failure in 2007, when it became clear that the adjustment for environmental damage had reduced the growth rate to politically unacceptable levels, nearly zero in some provinces. In the face of mounting evidence that environmental damage and resource depletion was far more costly than anticipated, the government withdrew its support for the Green GDP methodology and suppressed the 2005 report, which had been due out in March, 2007.^[1]

Independent estimates of the cost to China of environmental degradation and resource depletion have for the last decade ranged from 8 to 12 percentage points of GDP growth.^[2] These estimates support the idea that, by this measure at least, the growth of the Chinese economy is close to zero.

Although statisticians may caution about 'Green GDP' and its methodological problems such as monetizing the loss of biodiversity or the impacts of climate change caused by carbon dioxide emissions, one must also acknowledge how poorly represented true growth or sustainable development is with the anachronic GDP.

Some environmental experts prefer physical indicators (such as "waste per capita" or "carbon dioxide emissions per year"), which may be aggregated to indices such as the "Sustainable Development Index".

[edit] See also

• Genuine Progress Indicator (GPI)
• Environment of China

[edit] Further reading

• Green GDP Accounting Study Report 2004 issued.
• A brief explanation of Green GDP.
• China issues first 'green GDP' report - article from China Dialogue
• Environmental pollution costs China 64 billion dollars in 2004 - article from Terra Daily
• NYTimes documentary on China's Green GDP effort

[edit] References

1. ^ Kahn, J. and Yardley, J. (2007) "Choking on Growth: As China Roars, Pollution Reaches Deadly Extremes", The New York Times, 26 Aug 2007.
2. ^ Economy, Elizabeth (2007) "[Green GDP: Accounting for the Environment in China http://www.pbs.org/kqed/chinainside/nature/greengdp.html]", China from the Inside, U.S. Public Broadcasting System.