Analysis of green net national product and genuine saving in Portugal, 1991 - 2005

The context of this paper is the measurement of welfare and weak sustainability, defined as non-declining utility, in dynamic economies, i.e., green, environmental or comprehensive accounting. We estimate the green net national product and genuine saving for Portugal 1991-2005, accounting for the disamenity of air pollution emissions, the depreciation of commercial forests - pine and eucalyptus -, the value of time (through technological progress), excluding the effect of business cycles and discussing the assumptions behind the usual terms included in the empirics of comprehensive accounting. For the accounting period considered we find that both GNNP and GS are positive, thereby indicating no sustainability problem in Portugal, although both GNNP and GS depict a trend towards unsustainability. Excluding technological progress there is a contradiction in the sustainability message: GS is negative after 2002, whereas GNNP is always positive, indicating that welfare increased.