ABSTRACT
Taking natural capital and environmental quality seriously affects the way that we evaluate measures of national income and well-being. Many economists would assert that the average person living in a country with a high per-capita national income is essentially 'better off' than a person living in a country with a low per-capita national income. Standard measures of gross national product (GNP) or gross domestic product (GDP) measure a country's level of marketed economic activity. System of Environmental-Economic Accounting (SEEA) is a framework developed by the United Nations and other international organizations to provide standards for incorporating natural capital and environmental quality into national accounting systems. In addition to GDP, traditional national accounting methods also estimate saving and investment rates. Adjusted net saving is normally calculated as a percentage of national income, although it could also be expressed in monetary units. The Happy Planet Index (HPI) devises an entirely new approach to measuring national welfare in the context of environmental sustainability.
