Comprehensive Wealth in Canada—Measuring what matters in the long run
This report seeks to introduce the concept of comprehensive wealth to Canadians and outline why it should be considered an essential complement to the other measures such as gross domestic product.
Comprehensive wealth is made up of five components: produced, financial, natural, human and social capital. It is about measuring what matters in the long run, focusing on the role of people, the environment and the economy in creating and sustaining well-being.
Complementing the gross domestic product (GDP) and addressing issues it can’t capture on its own, comprehensive wealth measures are key to successfully guiding Canada through the 21st century and beyond.
With the support of the Ivey Foundation, the International Institute for Sustainable Development (IISD) has released this report to help Canadians understand what comprehensive wealth means and how measuring it can positively impact our future. The report finds that overall comprehensive wealth grew slowly between 1980 and 2013. After taking inflation and population growth into consideration, comprehensive wealth grew at an annual rate of 0.19 per cent over the period. In terms of its components:
- produced capital grew by 1.68 per cent annually, though most (70 per cent) of this growth was concentrated in the oil and gas extraction industry and housing
- market natural capital (fossil fuels, timber, minerals and farmland) declined by 0.93 per cent annually (for a total drop of 25 per cent)
- non-market natural capital (ecosystems and climate) declined based on a set of non-monetary indicators
- human capital, which accounts for about 80 per cent of Canada’s comprehensive wealth, did not grow at all, and
- social capital appears to have been stable based on a suite of non-monetary indicators.
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