Hints of Sustainable Development in the Philippines: Genuine Savings 1902-2018

Sammanfattning: The Philippines is one of the most affected countries by climate change. Income levels do not say much about its national wealth as it leaves out depreciation and excludes other necessary types of capital but are still mainly used to report a country’s economic standing regardless of its sustainability. This study uses Genuine Savings (GS) as an indicator of sustainable development and offers three main contributions to the field by (1) extending Philippine data back to 1902, (2) including fishery rents, and (3) incorporating total factor productivity (TFP) in its estimation of Philippine genuine savings. GS estimates using the current methodology have been extended by 75 years and at least 63 years' worth of data has been improved with additional components. A long-run analysis is made out of the data extension while the effects of additional components are compared to the current estimation of GS. The incorporation of fishery rents more than doubles resource rents, while TFP, on the other hand, causes large volatility in GS but shows a positive trend from the 1980s. The Philippine economy has been sustainable despite its quick-paced environmental degradation throughout the 20th century due to high levels of investments but the trend of sustainability has been decreasing ever so slightly in the last two decades. Future research must test the predictive power of GS as an indicator for future well-being and must include more environmental aspects that are relevant in the case of the Philippines, such as soil erosion, groundwater depletion, and especially biodiversity.