Time series analysis of the ISEW at the local (regional) level: method and intent

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.