File(s) under permanent embargo

Diminishing and negative welfare returns of economic growth : an index of sustainable economic welfare (ISEW) for Thailand

journal contribution
posted on 2005-07-01, 00:00 authored by Matthew ClarkeMatthew Clarke, S Islam
Thailand has achieved remarkable levels of economic growth over the last three decades. This sustained economic growth has played a major role in reducing absolute poverty levels from nearly one third of the population in 1975 to presently less than 10%, thus increasing the welfare of many Thais. This performance ranks Thailand as one of the world's most successful economies during this period. However, an increasing number of studies have begun to find that at a certain point achieving economic growth stops improving welfare and actually begins to diminish it due to the hidden and traditionally unreported costs of associated with this growth. With one exception, these new studies have focussed on high-income countries. This study will estimate an index of sustainable economic welfare (ISEW) for a developing country, Thailand, over a 25-year period, 1975–1999. This paper concludes that even low–middle income countries are beginning to approach the point in which economic growth produces both diminishing and, at times, negative welfare returns as the costs of achieving economic growth begin to outweigh the benefits. These results are important for policy makers and highlight the importance of implementing alternative welfare enhancing interventions that must be considered in place of simply achieving economic growth. The emphasis of this paper is not on the methodology of estimating the ISEW for Thailand, but rather on the policy implications for developing countries of diminishing and negative welfare returns brought about through the achievement of economic growth.

History

Journal

Ecological economics

Volume

54

Issue

1

Pagination

81 - 93

Publisher

Elsevier BV

Location

Amsterdam, The Netherlands

ISSN

0921-8009

eISSN

1873-6106

Language

eng

Notes

Available online 3 February 2005.

Publication classification

C1.1 Refereed article in a scholarly journal

Copyright notice

2004, Elsevier B.V.