Sustainable development? Trends in the development of the New Zealand economy

The principle of sustainable development has become the catchphrase of the 1990s. Many nations, including New Zealand, adopted this principle in the form of international agreements at the Earth Summit in 1992. At this conference, new ways to measure and assess progress towards sustainable development were called for. Among the indicators proposed to answer this call are the Genuine Progress Indicator, the Barometer of Sustainability and the Sustainable Human Development Index. For various reasons these indicators are unsatisfactory measures of sustainable development. In this study a new indicator of development, the Index of Sustainable Well-being (ISW) is proposed. The ISW is a weighted multiplication of three indexes; the Economic Performance Index, the Social Index and the Ecological Footprint Index. The Economic Performance Index involves adjusting GDP per capita for outputs not matched by monetary flows, and converting the result into international dollars. The Social Index combines indicators of basic needs (education, health and employment) with societal needs (income equality and political and civil freedom). The final index, the Ecological Footprint Index, involves calculating the economy's use of natural resources and environmental services. Together, these indexes attempt to capture the main interdependent aspects of sustainable development. When applied to the development of the New Zealand economy between 1987-1995, the ISW provides new evidence to suggest that New Zealand is becoming increasingly sustainable due to improvements in economic and environmental well-being