The Changing Wealth of Nations | Revisiting the Measurement of Comprehensive Wealth

Gross domestic product (GDP) is widely recognized as an insufficient measure of economic progress and national success. Since GDP is nearly universally available and comparable across countries, it is extensively used as a benchmarking and reference statistic, even for purposes for which it was not designed. GDP measures the level of domestic productive activity, but it ignores the costs of this growth in terms of the environmental degradation that occurs in the process of production, for example. Sir Partha Dasgupta likened this to a soccer team that only measures success as goals for and ignores goals against. This report is intended primarily for a technical audience, including policy advisors, statisticians, and researchers. It first presents the rationale for using wealth as a measure of economic progress (chapter 1), explains in detail the CWON methodology (chapter 2), and presents global trends observed in the data (chapter 3). It then discusses how the methodology could be further improved to account for the increasing relative scarcity of key assets, most notably renewable natural capital (chapter 4). The subsequent chapters present the methodology and trends of the assets of the CWON wealth portfolio that are developed by the World Bank: nonrenewable natural capital (chapter 5), hydropower (chapter 6), forests and agricultural land (chapter 7), blue natural capital (chapter 8), and human capital (chapter 9). The final chapter concludes and outlines ways to use the CWON database.