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Welfare Accounting and the Environment: Reassessing Brazilian Economic Growth, 1965–1993
Author(s) -
Torras Mariano
Publication year - 2001
Publication title -
development and change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.267
H-Index - 93
eISSN - 1467-7660
pISSN - 0012-155X
DOI - 10.1111/1467-7660.00203
Subject(s) - economics , national accounts , per capita , gross domestic product , measures of national income and output , per capita income , welfare , proxy (statistics) , real gross domestic product , development economics , sustainability , income distribution , natural resource , public economics , macroeconomics , inequality , population , market economy , political science , ecology , mathematical analysis , demography , mathematics , machine learning , law , sociology , biology , computer science
Few countries in recent decades have experienced economic growth as rapid as that in Brazil. The period spanning the late 1960s and mid 1970s, during which GDP growth was especially strong, is often referred to as the ‘economic miracle’. Yet, the use of per capita GDP growth as a proxy for economic development (or social welfare improvement) can be questioned on both distributional and environmental grounds. Scholars such as Ahluwalia and Chenery have noted that per capita GDP growth places greater weight on the income of richer income groups, and have proposed distribution‐neutral and pro‐poor alternatives. More recently, studies by the World Resources Institute and others have questioned the environmental sustainability of GDP growth and have introduced an alternative national income accounting methodology that factors in estimated losses associated with natural resource depletion. To date, no studies have undertaken both types of revisions concurrently, creating a revised national welfare measure based on per capita GDP, but corrected for both distributional bias and resource depletion. Such a measure is derived in this article and applied to the Brazilian case. The results cast doubt on the proposition that rapid economic growth in Brazil has resulted in comparable welfare gains.