The Sustainability Gap: a Practical Indicator of Sustainability in the Framework of the National Accounts

The concept of sustainable development needs to be based on a clear definition of sustainability and how it is to be measured. This paper defines environmental sustainability as the maintenance of important environmental functions, and identifies seven sustainability principles that relate this requirement to current environmental issues. From these principles, the paper derives physical indicators of sustainability, organised according to the framework of the national accounts, which enables a "sustainability gap" to be estimated, comprising the difference between the current level and the environmentally sustainable level of the indicator in question. This physical "sustainability gap" can be given a monetary value according to the expenditure that would be necessary on abatement or restoration technologies to close the gap. Although the monetary "sustainability gap" cannot appropriately be used to adjust the national accounting aggregates, its value, and its ratio to GNP, provide useful information both to decision-makers and to the general public about the economic effort that would be required to achieve an environmentally sustainable economy.