1887

OECD Green Growth Papers

The OECD Green Growth Strategy, launched in May 2011, provides concrete recommendations and measurement tools to support countries’ efforts to achieve economic growth and development, while at the same time ensure that natural assets continue to provide the ecosystems services on which our well-being relies. The strategy proposes a flexible policy framework that can be tailored to different country circumstances and stages of development. OECD Green Growth Papers complement the OECD Green Growth Studies series, and aim to stimulate discussion and analysis on specific topics and obtain feedback from interested audiences.

English

Environmentally Adjusted Multifactor Productivity

Methodology and Empirical results for OECD and G20 countries

The paper further refines the OECD framework for measuring the environmentally adjusted multifactor productivity growth that seeks to incorporate environmental services in productivity analysis. Compared to standard productivity measurement, this framework allows accounting also for the use of natural capital (currently including 14 types of fossil fuels and minerals) and the emission of pollutants as negative by-products (currently including 8 types of greenhouse gases and air pollutants). An updated series of the indicator is presented, with a geographic coverage extended to all OECD and G20 countries for the 1990-2013 time period. The indicators presented here allow the sources of economic growth to be better identified, and growth prospects in the long run to be better assessed.

This paper replaces the 2016 version which contained outdated information on natural capital for a few countries corresponding to an earlier version of the estimations. Figures 1-10, A4.1, A5.1, A5.2, A6.1 have therefore been adjusted, with the only noticeable change being the ranking in the contributions of natural capital to output growth. The main messages and conclusions remain unchanged.

 

English

Keywords: multifactor productivity, green productivity, total factor productivity, growth accounting, productivity measurement, exhaustible natural capital, emission shadow prices, air pollution
JEL: O47: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence; O44: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Environment and Growth; Q3: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Nonrenewable Resources and Conservation; Q52: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Pollution Control Adoption and Costs; Distributional Effects; Employment Effects; Q56: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth; D24: Microeconomics / Production and Organizations / Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity; Q53: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
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